One of the most important lessons the subprime mortgage
crisis holds for us is just how poorly informed many Americans are when it
comes to making important financial decisions. Clearly, there is a need for
basic financial education. But when, where, and how should such education be
delivered? Financial literacy programs aimed at high school students do not
appear to be effective, and few adults are willing to expend the time, money,
and effort to acquire the sort of general education that would help them make
good… more
Ellen Seidman, a fellow at the New America Foundation, says Congress is unlikely to force Treasury to adopt the FDIC proposal before President-elect Barack Obama takes office. But that doesn't mean the FDIC proposal is dead.
"This is also out here so that in a different Congress and a different administration, there's something ready to roll," Seidman says. LINK to audio
On September 7, Fannie Mae and Freddie Mac were placed into conservatorship. There was an expectation that the move would make the companies, which had hunkered down to preserve capital, much more active in dealing with the on-going housing crisis. What has actually happened, and what are the prospects for the future? How have the companies dealt with borrowers in trouble on the loans Fannie and Freddie own or have guaranteed? How are they working with… more
The question crossed my mind after New America Foundation’s Ellen Seidman described as “really inept” a news conference on Tuesday by Treasury, Fannie Mae and Freddie Mac, to announce a new program to streamline loan modifications. Seidman said Treasury completely oversold the plan, to make it seem like it would cover more mortgages than the plan actually called for. Then, to make it worse, the Treasury spokesman ran out of the briefing room to avoid answering questions. LINK
Tuesday night, I checked in with Ellen Seidman of the New America Foundation, who specializes in the financial services industry, to find out her reaction. Seidman, who closely follows loan modifications, said that people don’t really understand that the Fannie and Freddie plan is aimed at heading off foreclosures among prime borrowers — the next segment of homeowners in danger of defaulting on their mortgages. In that sense, the program has some merit. LINK
Ellen Seidman, a financial services policy director for New America Foundation's Asset Building Program, outlined a set of guidelines for lawmakers to take into consideration for improving the financial services regulatory regime. Policy changes should incorporate consistent regulation based on activity rather than entity, effective enforcement, transparency, as well as capital adequacy standards, Seidman said. LINK (subscription required)
"We've been jumping from program to program, and if there is an infinite number of things we can do with money, there is a need for an infinite amount of money," said Ellen Seidman, director of the New America Foundation's Financial Services and Education Project and a former director of the Office of Thrift Supervision. "If you keep expanding the scope of what it is you are going to do with the money, you keep expanding your need for money."… more
Executive SummaryComprehensive strategies for educating children and youth so
they can become effective managers of money and successful navigators of a
complex financial marketplace have not yet emerged from the dialogue and debate
surrounding financial education. A rich
and growing body of research about adult financial education exists, but youth
financial education research has been slower in developing. While some consensus has emerged regarding
best practices for adult financial education, these strategies and approaches
cannot simply be reengineered down to more age-appropriate versions and imposed
on… more
Baker,
C. and D. Dylla (2007). "Analyzing the
Relationship Between Account Ownership and Financial Education." New America
Foundation.
Abstract: Account ownership and financial knowledge are
understood to be critical components of financial stability and wealth
accumulation. Presumably, combining financial education and accounts reinforces
the positive effects of each on the other and enhances the recipient's
financial well being. To date, however, no testing of this hypothesis has been
undertaken. This report sets out to do that. It presents a review of programs
across the country that… more
