Paulson Wants Urgent Action to Deal with Housing Crisis

Treasury Secretary Henry Paulson called for an aggressive response to deal with the housing market crisis that he said presents a significant risk to the economy. In the administration's most forceful reaction to the housing slump, Paulson said that government and the financial industry should provide immediate help for homeowners trying to refinance current mortgages before they reset at much higher rates. He also called for an overhaul of laws and regulations governing mortgage lending to halt abusive practices that he said contributed to the current crisis. "Let me be clear, despite strong economic fundamentals, the housing decline is still unfolding and I view it as the most significant current risk to our economy," Paulson said in a speech delivered at Georgetown University's law school. Paulson said that the housing correction is "not ending as quickly" as it had appeared it would and that "it now looks like it will continue to adversely impact our economy, our capital markets and many homeowners for some time yet."

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