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‘Happy Holiday fix for The Crunch’

Commentary: New loans, bank bailout would thwart recession

In thin holiday markets, The Crunch hasn't stolen Christmas, just given a mixed blessing: Mortgages fell from 6.25 percent to 6 percent in one week as fear of credit default returned and money raced to quality for safety. Expectation of economic slowdown has spread during December, now nearly unanimous, modified by disagreement about extent and duration, and total chaos at the subject of what to do about it. Inflation worriers say the Fed should stay put, just ride it out, joined by believers in Mr. Market. The interveners are mostly backward-looking: in the lead, how to prevent foreclosures. Too late for that. The worst idea came from my rapidly aging hero, former Fed Chairman Alan Greenspan: just give money to the foreclosed households. Pardon? How would you separate the unlucky and imprudent from the deserving -- and from the proud souls still making payments they cannot afford? Other ideas that won't work: a tax cut, or further cuts in the Fed's rate. They will soften t...

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