builder bailout is a non-event
Banking system bailout is different. This was an unmitigated evil, because it prevented the banking system from collapse. Now, as to the desirability of builder bailout, I am agnostic. If builders don't get a bailout, then land will remain cheaper for a while, as floridabuilder points out. Sadly, with land investors not selling anything because they recognize the value of land too well, bancrupt builders is the only remaining suurce of cheap land. Not that it's going to make housing any cheaper becuase in the absence of competition, the remaining builders are not going to pass their lower input costs to consumers, they will keep it all to themselves. On the other hand, if we do have a bailout, the industry will stay competetive and run slimmer profit margins, but again, these slimmer margins will not produce cheaper prices because competing builders will drive up the cost of land. Now you have builders ready, or, rather, forced by the "invisible hand" to pass their cost savings to consumers, but unfortunately, they have no cost saving to pass along. So either way, the consumer is screwed. The only practical question is which builders to greenthumb. If there is no bailout, then we have a winner-take-all scenario, with TOL and MDC emerging victorious. If the bailout comes to pass, the spoils will be distributed more equally among the players, and then HOV, SPF, and BZH will outperform the rich builders because avaoiding Ch 11 is all it really takes for them to produce a two-bagger in the short term. Either way, floridabuilder is wrong: affordability is not coming back, and it is only the short-term price of land that is debatable.