Who's Responsible for This Mess?

Well, I'll be. They are finally getting their hands dirty. Two new programs announced Tuesday are the most bold and, frankly, foolproof yet because they can't not work. The first, the buying of GSE debt, immediately took mortgage rates below 5%. In one day! That will, at last, trigger a huge wave of refinancing and a definite rush to buy homes for those who have been holding back. I reiterate that housing bottoms next year!

The second, needed to jumpstart the completely moribund asset-backed market, will allow you to buy asset-backed bonds that are guaranteed by the Treasury, meaning that you would be a fool not to borrow because you are buying risk-free bonds with much higher rates than Treasurys. How can that not work? How can you not want to lever up to buy them? At last we are totally interventionist with all stops being pulled out, no niceties. We are just printing money and giving it at a great rate to anyone who wants it.

One of the most exasperating elements of this financial era is the desire of the feds not to intervene in situations that demand intervention. There's a quartet of fellows at fault: New York Fed president and soon to be Treasury secretary, Timothy Geithner; Chris Cox of the Securities and Exchange Commission; Ben Bernanke of the Federal Reserve ; and Hank Paulson of Treasury.

Right now we are supposed to believe that everything good is from Geithner and he has made no wrong moves. But Bernanke's also blessed with no critics whatsoever. Cox, we all know, is over his head but somehow we have exonerated him because the New York Fed has primary responsibility for the banks. But again, Geithner's done nothing wrong, so that means Paulson must be at fault.

Paulson's a big target and he has screwed up mightily.

ALL JIM CRAMER BLOG ENTRIES | POST A COMMENT | READ COMMENTS  

---

Jim Cramer is co-founder and chairman of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for Action Alerts PLUS. Watch Cramer on "Mad Money" weeknights on CNBC. To order Cramer's newest book -- "Jim Cramer's Stay Mad for Life: Get Rich, Stay Rich (Make Your Kids Even Richer)," click here. Click here to order "Mad Money: Watch TV, Get Rich," click here to order "Real Money: Sane Investing in an Insane World," click here to get "You Got Screwed!" and click here for Cramer's autobiography, "Confessions of a Street Addict." While he cannot provide personalized investment advice or recommendations, he appreciates your feedback and invites you to send comments by clicking here.

TheStreet.com has a revenue-sharing relationship with Amazon.com under which it receives a portion of the revenue from Amazon.com purchases by customers directed there from TheStreet.com.