One of the tax payer's most recent acquisitions, Bank of America, announced today that it will be writing down the principle on $3 billion in mortgages for 45,000 struggling home owners. (The tax payer only pays for the losses for Bank of America, it does not share in the profits)
This move will most likely be followed by the other large banks now that they have accumulated $1.2 trillion in interest free cash reserves from the Federal Reserve.
It also takes away the last remaining reason for a homeowner that is underwater to continue making their payments.
In addition, this move provides new incentives for Americans to max out credit cards and not make payments to be in line for the credit card principle write down that will coming next.