Do We Need Another Housing Bailout?

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Today's S&P/Case-Shiller housing report shows the US National Home Price Index rose 4.4% in the second quarter of 2010. This has many investors wondering whether housing prices have hit bottom or if there's still room to fall. Washington is still looking at homebuyer incentives to ensure housing stays afloat. So, we put the question to The Kudlow Caucus...

Take our poll below and tell us what you think! Watch "The Kudlow Report" tonight at 7pm ET and find out what out caucus members have to say or check back here later for a summary from our caucus members.

The Kudlow Caucus Breakdown

Jerry BowyerEconomist, CNBC Contributor
When it comes to housing policy these guys in Washington are Midas-in-reverse. Everything they touch turns to junk. If they leave it alone and promise never to try to fix it again, MAYBE we still have a chance.

Andrew B. BuschGlobal Currency and Public Policy Strategist
BMO Capital Markets
No, we need a program that incents both the banks and the homeowners via principal reductions and profit-sharing on resale.

Kellyanne ConwayCEO and President
the polling company™
Government intervention in economic policy has aided and abetted the current disaster. No more bailouts.

David P. GoldmanSenior Editor
First Things
The first one failed, and another one will fail, too.

David GoodfriendLawyer
The first one didn’t work, nor will a second.

Jim LaCampPortfolio Manager, Portfolio Focus, RBC Wealth Management
Co-Host, Opening Bell Radio Show, Biz Radio Network
Inventories are far higher than are being reported. Prices must come down to the point where they attract buyers through normal, free-market capitalistic forces. Through Fannie, Freddie, Home Affordable Modification Program and the homebuyer tax credit, taxpayers have been asked to do too much to prop up this market. Let free-market forces do their job.

Art LafferFmr. Reagan Economic Advisor
Chief Investment Officer, Laffer Investments
These programs have imposed an enormous tax burden on the economy, crushing output, employment and incomes, while merely stealing demand from the future.

Donald L. LuskinChief Investment Officer, Trend Macrolytics LLC
We need to NOT have another housing bailout. How many failures of this kind of policy do we need before we keep taking another dose of the same poisonous medicine?

Steve MooreSr. Economics Writer, The Wall Street Journal Editorial Board
Bailouts of housing have made the housing crisis worse, and we need to just get to the bottom and let recovery take hold. All these mortgage modification programs are delaying the day of reckoning.

Peter Navarro
Business Professor
University of California, Irvine
What we need is a more targeted effort to provide mortgage refinancing to distressed homeowners without enough equity to qualify for a refinancing and to provide mortgages to people currently unable to qualify at exceedingly high standards. This can be structured as a win-win for all parties.

James Pethokoukis
Money & Politics Columnist
Unemployment is driving the sector's continued woes. Boost the economy (via tax cuts) and you boost employment. A massive housing bailout would make me seriously wonder about the creditworthiness of US bonds.

Mark Walsh
Political Strategist and Campaign Innovator
Yes, but not cash. We need a series of voluntary waivers of mortgage foreclosure behavior on behalf of big banks so homeowners underwater are not put into personal Chapter 11 because of their asset-to-debt ratio. Housing prices and debt levels will rationalize themselves, but NOT in the time frame of the current consumer mortgage agreements. Banks should be rewarded in some fashion for taking these steps.

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