Greetings from D.C.

Dear Readers,

I can honestly say that Steven Latourette (14th District, Ohio) is doing a nice job in Washington D.C. The fact that he went to exhaustive lengths to read and answer my letter of inquiry shows me that things are not totally broken in D.C..

I am glad that he is no the Financial Services Committee and has a pulse on the current situation. The fact that he and his fellow Congressmen are holding hearings on the BSC bailout by the Fed is a good sign, as he suggested that some heads might roll on this one.

Interestingly enough, the esteemed Congressman even mentioned the name of Ron Paul when it came to fiscal responsibility.

While I am not totally convinced of the legislation on housing, there seems to be an attempt to remedy the situation. I believe the President will have no problem vetoing the bill if it is too radical. The bill, when explained in LaTourette's terms suggested that banks and financials will face another series of write-downs before the government extends financial assistance to home buyers.

Of course we fall back into the argument that why do any of these home buyers deserve any help? And the response (if I am reading it correctly) is that there is a general concern that the financial deadbeats could have a domino effect on neighborhoods and effect property values. That's when all of us move to Australia to avoid the real fallout of busted home equity appraisals and a general devaluation of property.

The credit card companies are going to feel a pinch here as well. Not only is there impending legislation from Congress...and another set of hearings to take place. The Fed will also be made fully compliant to Regulation Z, or what we commonly refer to as TRUTH in LENDING. My fear is that this will create another paragraph on a disclosure statement that is already over-loaded with information. Maybe we need financial and legal training in our schools...

In closing, the Congress even supplied me with a direct contact number should I have additional questions or comments. The following is a scanned copy of the letter...

BD

COMMITIEE ON TRANSPORTATION AND INFRASTRUCTURE

RANKING MEMBER, SUBCOMMITTEE ON COAST GUARD AND MARITIME TRANSPORTATION

COMMITTEE ON FINANCIAL SERVICE

Dear Mr. Davis:

Steven C. Latourette

Congress of the United States 14^th District, Ohio

May 23, 2008

Thank you for passing along your thoughts on a number of issues that are critical to our economy. It was great to see you during your trip and I am happy to give you' my views on these

topics.

There is no question that the increased actions of the Federal Reserve need to be closely monitored by Congress. The Bears Steams package has become the symbol of this increased role and there are many questions that my colleagues and I have on this subject. In fact, Republicans on the House Financial Services Committee, of which I am a senior member, have called on Chairman Barney Frank (D-MA) to hold a full committee hearing on the Bears Steams deal and to examine what role the Fed is going to have in this recent economic slowdown. Additionally, I agree with my colleagues like Rep. Ron Paul (R-TX) that we need to take action on the devaluation of the dollar and address the overall lack of responsible saving that has plagued our country at both the corporate and personal level. That last point certainly plays along with your desire to see greater financial education at all levels in our schools.

As you may know, the House recently moved a substantial housing package that we believe will bring stability to the market, without exposing taxpayers to undue risk. The most important part of the package gives the Federal Housing Administration (FHA) the ability to insure up to $300 billion in restructured mortgages.

This voluntary program will call on lenders to reduce a particular mortgage and in return would get a federal guarantee on the reduce mortgage agreement. This will allow the borrower to have a lower fixed payment and hopefully give them enough relief to stay in the house. This program will be for primary residence owners only and the government will get a percentage of the profits when prices rebound and owners choose to sell. While the overall number appears high, the Congressional Budget Office has estimated the real cost over the life of the program should only be around $2.7 billion.

Another piece of legislation that should be included in the overall housing package that will be sent to President Bush contains $15 billion in grants and loans for states and local authorities to secure and maintain foreclosed properties. This will provide relief to responsible borrowers that continue to stay current on their payments. There is no reason these folks should lose significant

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value on their property, because they are surrounded by foreclosed properties.

Finally, Rep. Carolyn Maloney (D-NY) has introduced a credit card reform package that will look to implement tighter underwriting standards and increase disclosures to consumers. We have only had hearings on the matter thus far, but there is a chance we could markup a bill on this subject in the near future. It is also important to note that the Fed is working on reforms to Regulation Z, which provides guidance and regulation to the credit card companies.

Again, thank you for your kind words and support. Please contact C,J. Lennon in my Washington D.C. office at (202) 225-5731 at any point in the future. As my staff designee on the House Financial Services Committee, he would be happy to discuss any of these issues with you personally as we move forward.

Steven C. LaTourette

Member of Congress

SCL/KO