The White House released a plan to provide aid to select troubled homeowners. The plan, negotiated among the Treasury Department, mortgage lenders, and banks, proposes freezing the current borrowing rates on certain subprime mortgages for the next five years. In order to qualify for the interest rate freeze, borrowers must be current with their monthly mortgage payments (not more than 30 days late). Additionally, anyone who has been more than 60 days late with a payment within the past twelve months will not be eligible. Aside from the housing plan, there was also some hawkish commentary released today from the president of the European Central Bank (ECB). President Trichet stated that he is seeing strong upward pressure on inflation, and although the bank maintained their benchmark interest rate at 4%, he noted that several council members were actually in favor of raising rates to stifle inflation. On the flip side, the Bank of England cut its interest rate by 25 basis points to 5.5% to stimulate its economy.
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