The urgent necessity of President elect to tackle the foreclosure related crisis couldn’t be over stressed. It is not about statistics and figures but real people who are in danger of being thrown out of their homes and hearths. So the new incumbent to the White House must act here and now putting campaign talk into practice before the situation worsens. There is no other way of avoiding recession turning into sour depression.

The first step will be the injection of some kind of fluidity in the cash flow. The outgoing administration has taken the correct step towards this and slowly it seems to be showing results. But the efforts have been insufficient. More is required.

The president has to give first preference in supporting the housing sector. The financial crisis has largely been due to the travails in the housing sector plagued by foreclosures. This has been followed on by increasing unemployment and falling real estate market. To reverse the situation the housing sector has to be propped up first. Others will follow. It must not be forgotten that the householders are the first and foremost customers of American business.

As a start the president should request the Congress to extend the insurance benefits of the unemployed for another six months. But this will be only a temporary painkiller and not the curative medicine. It is only with the stabilization of the real estate market that sanity will return to the economy.

The origins of the financial crisis go back to the time when defaults on sub-prime mortgages began to increase from the summer of last year – 2007. So the target is to check the continuing defaults. This in turn will put a halt on foreclosures. With the stopping of reo homes rushing into the market the price of property will find a level and not go down further. If not the vicious cycle will continue – further defaults will lead to foreclosures and falling prices. The gloom in the construction industry will then spill over to other sectors. A jobless construction worker cannot buy a car. So that group suffers. People with slim purses do not dine out and so the eateries are affected. The links in the chain are endless. Ultimately the morale of the millions of people, that makes up the American nation become as depressed as the economy.