Geithner: Freeze On Foreclosure Sales Would Worsen "National Tragedy"

(RTTNews) - A national moratorium on foreclosure sales might further depress housing prices, hurting those already squeezed by the housing crunch, according to Treasury Secretary Timothy Geithner.
Appearing on the Charlie Rose Show, Geithner said the foreclosure crisis was a "national tragedy," but that a total freeze on foreclosure proceedings would delay the healing of the housing market.
Banks have been accused of cutting corners in order to rush through foreclosure proceedings, resulting in a wave of improper evictions.
Rather than a government imposed moratorium, Geithner argues that certain banks should temporarily suspend the foreclosure process to prevent more injustices.
Geithner said a national moratorium on foreclosure sales would lead to houses being unoccupied longer, resulting in lower home prices.
"This would hurt exactly the kind of people we're trying to protect," he told Rose.
When asked about stubborn weakness in the jobs market, Geithner said it is a reflection of how bad the financial crisis was.
Businesses have been scarred by the financial meltdown, and while they are starting to spend at a more encouraging level, are waiting to see more robust growth before ramping up hiring, Geithner said.
The economy is not rebounding rapidly enough to provide new opportunities, and it will "take time" for the unemployment rate to drop acceptable levels.
"Washington has more to do," Geithner acknowledged, addressing questions about whether the first stimulus package was large enough.
"We needed to get something in place quickly," Geithner said in defense of the $787 billion package announced in February 2009. "We didn't have the luxury of debating what the appropriate level of stimulus would be."