Federal proposes government to help homeowners

Federal Reserve is proposing that the government need to provide direct financial assistance to people who are facing credit crisis and this will help the homeowners directly. The Fed said that this method will be more effective than reducing taxes or any other monetary help to people facing credit problems.

The Fed said that the methods employed by government to provide cash grants to homeowners or to reduce taxes will enhance the problem indefinitely instead of imposing a break on it and the economy will also be affected negatively by these steps.

Fed said that these methods will increase pressure on federal budget as well and the best possible method for solving these problems is that the government directly provides financial assistances to homeowners.