The Bush Freeze: What's In It For Lenders?

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"Why is it good for a lender to be forced to make concessions to borrowers?" Floyd Norris asked last night.
It's a good question. On the face of it, the Bush administration's plan to freeze mortgage rates would seem to place a burden on lenders by restricting them from exercising their contractual rights. What's more, if a freeze doesn't burden lenders--if it benefits them--why would we need a government organized plan to bring it about? Shouldn't the self-interest of mortgage lenders have arrived at this through the action of the free market?
But few, if any, lenders or investors are complaining. Indeed, most seem enthusiastic about the plan. Stocks of lenders such as Countrywide rallied on the news. This implies that the Bush freeze is good for at least some lenders. We've got our own ideas about this that we'll revisit later today (hint: it's a collective action problem.) But for now we want your opinion. In comments, leave your answers to Norris' question. And, after the jump, feel free to vote in our poll asking whether Floyd Norris and investors buying up shares in lenders are right: is the freeze good for lenders.
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