US Federal Reserve Chairman Ben Bernanke suggested that policymakers look for ways to encourage a wider range of mortgages geared for low-income and other borrowers who have been hard hit by the housing slump and credit crunch.
Bernanke, in a letter to Senator Charles Schumer released on Wednesday, said the Fed is keeping close tabs on financial markets and is "prepared to act as needed" to make sure spreading credit problems that have rocked Wall Street in recent weeks don't hurt the economy.
It's a message the central bank has been sending in recent weeks as the markets have grown more turbulent.
Foreclosure and late payments have spiked especially for "subprime" borrowers with blemished credit histories or low incomes.
Higher interest rates as well as weak home values have made it impossible for some to pay or keep up with their monthly mortgage payments.
Some overstretched homeowners can't afford to refinance or even sell their home.
Bernanke said that the development of "a broader range of mortgage products which are appropriate for low and moderate-income borrowers, including those seeking to refinance" might help the situation.
"Such products could be designed to avoid or mitigate the risk of prepayment shock and to be more transparent with respect to their terms," Bernanke wrote in the letter, which was dated on Monday.
Mortgage foreclosures and late payments are expected to get even worse in the next year and a half as low introductory "teaser" rates that lured in borrowers reset to higher rates, socking some homeowners.
Some 2 million adjustable rate mortgages are expected to reset to higher rates this year and next.
Bernanke said that the Federal Housing Administration (FHA), a government agency that insures home loans, might be able to help.
"The Congress might wish to consider FHA reforms that allow the agency more flexibility to design new products and to collaborate with the private sector in facilitating the refinancing of creditworthy subprime borrowers facing large resets," Bernanke said.
The administration of President George W. Bush is looking into ways that the FHA -- which is part of the Department of Housing and Urban Development -- would be able to help troubled homeowners with low incomes or who have tarnished credit histories.
Government-sponsored housing finance agencies Fannie Mae and Freddie Mac, meanwhile, "should be encouraged to provide products for subprime borrowers to the extent permitted by their charters," Bernanke said.
He did not provide specifics and believed that caps on the two mortgage companies' portfolios need not be raised to accommodate new borrowers.
Nvidia Corp yesterday unveiled its new high-speed interconnect technology, NVLink Fusion, with Taiwanese application-specific IC (ASIC) designers Alchip Technologies Ltd (世芯) and MediaTek Inc (聯發科) among the first to adopt the technology to help build semi-custom artificial intelligence (AI) infrastructure for hyperscalers. Nvidia has opened its technology to outside users, as hyperscalers and cloud service providers are building their own cost-effective AI chips, or accelerators, used in AI servers by leveraging ASIC firms’ designing capabilities to reduce their dependence on Nvidia. Previously, NVLink technology was only available for Nvidia’s own AI platform. “NVLink Fusion opens Nvidia’s AI platform and rich ecosystem for
WARNING: From Jan. 1 last year to the end of last month, 89 Taiwanese have gone missing or been detained in China, the MAC said, urging people to carefully consider travel to China Lax enforcement had made virtually moot regulations banning civil servants from making unauthorized visits to China, the Control Yuan said yesterday. Several agencies allowed personnel to travel to China after they submitted explanations for the trip written using artificial intelligence or provided no reason at all, the Control Yuan said in a statement, following an investigation headed by Control Yuan member Lin Wen-cheng (林文程). The probe identified 318 civil servants who traveled to China without permission in the past 10 years, but the true number could be close to 1,000, the Control Yuan said. The public employees investigated were not engaged in national
ALL TOGETHER: Only by including Taiwan can the WHA fully exemplify its commitment to ‘One World for Health,’ the representative offices of eight nations in Taiwan said The representative offices in Taiwan of eight nations yesterday issued a joint statement reiterating their support for Taiwan’s meaningful engagement with the WHO and for Taipei’s participation as an observer at the World Health Assembly (WHA). The joint statement came as Taiwan has not received an invitation to this year’s WHA, which started yesterday and runs until Tuesday next week. This year’s meeting of the decisionmaking body of the WHO in Geneva, Switzerland, would be the ninth consecutive year Taiwan has been excluded. The eight offices, which reaffirmed their support for Taiwan, are the British Office Taipei, the Australian Office Taipei, the
CAUSE AND EFFECT: China’s policies prompted the US to increase its presence in the Indo-Pacific, and Beijing should consider if this outcome is in its best interests, Lai said China has been escalating its military and political pressure on Taiwan for many years, but should reflect on this strategy and think about what is really in its best interest, President William Lai (賴清德) said. Lai made the remark in a YouTube interview with Mindi World News that was broadcast on Saturday, ahead of the first anniversary of his presidential inauguration tomorrow. The US has clearly stated that China is its biggest challenge and threat, with US President Donald Trump and US Secretary of Defense Pete Hegseth repeatedly saying that the US should increase its forces in the Indo-Pacific region
RSS