| 1 | House Memorial |
| 2 | A memorial to the Congress of the United States, urging |
| 3 | Congress to take emergency action to protect homeowners |
| 4 | and banks and to enact a Homeowners and Bank Protection |
| 5 | Act. |
| 6 |
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| 7 | WHEREAS, the onrushing financial crisis involving home |
| 8 | mortgages, debt instruments of all types, and the banking system |
| 9 | of the United States threatens to set off an economic collapse |
| 10 | worse than the Great Depression of the 1930s, and |
| 11 | WHEREAS, millions of Americans will be faced with |
| 12 | foreclosures and the loss of their homes over the coming months, |
| 13 | and |
| 14 | WHEREAS, hedge funds, which spread this financial collapse |
| 15 | among markets worldwide by dominating speculation in those |
| 16 | markets, are now going bankrupt and demanding government bailout |
| 17 | of their securities and derivatives, with the nominal value of |
| 18 | the derivatives based on mortgages alone equal to the size of |
| 19 | the combined gross domestic product (GDP) of the nations of the |
| 20 | world, and |
| 21 | WHEREAS, this financial crisis threatens the integrity of |
| 22 | both federal and state chartered banks, as typified by the run |
| 23 | on deposits of Countrywide Financial Corporation in California |
| 24 | during August 2007, which could wipe out the life savings of |
| 25 | many American people and drastically undermine the economic |
| 26 | stability of our states and cities, and |
| 27 | WHEREAS, under similar circumstances in the 1930s, |
| 28 | President Franklin D. Roosevelt successfully intervened to |
| 29 | protect banks and homeowners, addressing Congress with a |
| 30 | declaration of national policy on April 13, 1933, which stated |
| 31 | "that the broad interests of the Nation require that special |
| 32 | safeguards should be thrown around home ownership as a guarantee |
| 33 | of social and economic stability and that to protect homeowners |
| 34 | from inequitable enforced liquidation in a time of general |
| 35 | distress is a proper concern of the Government," NOW, THEREFORE, |
| 36 |
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| 37 | Be It Resolved by the Legislature of the State of Florida: |
| 38 |
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| 39 | That the Congress of the United States is requested to take |
| 40 | emergency action to protect homeowners and banks and enact a |
| 41 | Homeowners and Bank Protection Act specifically to: |
| 42 | 1. Establish a federal agency to place federal and state |
| 43 | chartered banks under protection, freeze all existing home |
| 44 | mortgages for a period of time, adjust mortgage values to fair |
| 45 | prices, restructure existing mortgages at appropriate interest |
| 46 | rates, and write off speculative debt obligations of mortgage- |
| 47 | backed securities, financial derivatives, and other forms of |
| 48 | financial pyramid schemes that have brought the banking system |
| 49 | to the point of bankruptcy; |
| 50 | 2. Declare a moratorium on all home foreclosures for the |
| 51 | duration of the transitional period, allowing families to retain |
| 52 | their homes, and provide for monthly payments that are the |
| 53 | equivalent of rental payments to be made to designated banks, |
| 54 | which can use the funds as collateral for normal lending |
| 55 | practices, thus recapitalizing the banking system. These |
| 56 | affordable monthly payments shall be factored into new |
| 57 | mortgages, reflecting the orderly deflating of the housing |
| 58 | bubble and the establishment of appropriate property valuations |
| 59 | and reduced fixed mortgage interest rates. During the interim |
| 60 | period needed to achieve these requirements, no homeowner shall |
| 61 | be evicted from his or her property, and the federal and state |
| 62 | chartered banks shall be protected so that they can resume their |
| 63 | traditional functions of serving local communities and |
| 64 | facilitating credit for investment in productive entities; and |
| 65 | 3. Authorize state governors to assume the administrative |
| 66 | responsibilities for implementing the act, including the |
| 67 | establishment of payment of rental assessments to designated |
| 68 | banks, with the Federal Government providing the necessary |
| 69 | credits and guarantees to ensure the successful transition. |
| 70 | BE IT FURTHER RESOLVED that copies of this memorial be |
| 71 | dispatched to the President of the United States, to the |
| 72 | President of the United States Senate, to the Speaker of the |
| 73 | United States House of Representatives, and to each member of |
| 74 | the Florida delegation to the United States Congress. |