FDIC chief argues for stronger rules for home loans at Valley conference

“The home mortgage market needs strong rules,” said FDIC chair Sheila Bair. Bair appeared at the McEnery Convention Center as part of the annual “State of the Valley Conference” sponsored by Joint Venture: Silicon Valley Network. The conference bills itself as “Silicon Valley’s Annual Town Hall Meeting” and marks the release of Joint Venture’s Index of Silicon Valley.

In keeping with the mission of Joint Venture, the index tracks a number of barometers of the valley’s health, both economic and social. It has been produced since 1995 by Joint Venture, a non-profit community group that combines representatives of industry, government, education and social service non-profits.

This year, the index, which was compiled for the first time in collaboration with the Silicon Valley Community Foundation, focused to a large degree on the pressures being felt by the valley’s middle class. But much of the buzz around the local economy also centers around the declining housing market. The outlook, according to Bair, is not pretty. Housing prices will continue to decline across the country for quite awhile. “There’s going to be more pain before we get through it,” Bair said.

“But we will get through it.” To ease that pain, the FDIC is focusing on trying to stem the tide of Advertisement foreclosures. Bair said her agency is pushing lenders to focus more on modifying or renegotiating existing loans, rather than moving so fast to foreclosure.