Mortgage mess: US Treasury to freeze ARMs?

Looks like the Bush administration, under the purview of the US Treasury Department, is considering freezing adjustable mortgage rates for up to 5 years.

Crazy.

Sure, my budget will like it. I'll get 5 more years of a 4.75% rate. Wonderful.

But won't such an action completely dampen the real estate market? It seems like it should...what am I missing?

Surely, the industry players who helped to fan the market flames, like WaMu, CountryWide, and BofA, will suffer some consequences, but they most likely will come out of this like they always do: Better off, with more money, more capital, more customers, and more audacity than before.

I think the market needs to be enabled to work. Sure, some regulations have to be out there, but this drastic attempt just feels wrong.

Thoughts? A free book to the commenter I deem to have the best answer. Make sure you leave me an email after you comment with your email address. If you win, I'll contact you for your mailing address.

Besides, this can't be a good idea if Hillary likes it. That makes it all the more yucky.

What's Wrong With a Teaser Freezer?
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