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Very much in conflict. that can just not be justified. if we break it up, if we require them to separate it it would be a wholesome effect on the foreclosure problem. >> have you thought about whether if you did this, that the servicing banks, city group and jpmorgan and they're now in the business of taking care of the first mortgage, not taking care of my second lien, in doing that you would annihilate the balance of big banks by forcing them to stop lying about the value of their assets. >> it might well be a problem for them. they're carrying the $450 billion in second mortgages, second li...

The government can hold on to the shares as long as it wants to. it doesn't want to hold on to the shares. we need the government to get out of the business of investing in banks and private companies in general. most agree about that. the government can sit and wait. >> talk to me about the obama administration's efforts to save the housing market, giving incentives to lenders to stem this huge flow of foreclosures. good idea? >> this is the main street bailout. the other part. the results from this are going to be much more ambiguous. it's very hard it to solve the foreclosure problem and th...

That it makes more sense to walk away. so, those two reasons together are really why the foreclosure problem will remain a huge issue this year. >> and we talk about d.c. becoming a little bit more competitive. any other areas out there that are stabilizing, if not upward ticking? >> well, the market really right now is split on two different levels. the lower-end homes -- first-time buyers make up 40% of sales right now. investors are another 17%, and they're interested in the lower-end homes. so, those -- there's multiple bids coming in. it's a very competitive market, not so much at the hig...

There are no end, but what's required first of all is for the major lenders to see the turning of this market. and perhaps some putting their feet to the fire to make it possible for that market to turn by lending conditions. >> john, the same question. >> i'd add no more lending or supporting or even access to the fed window for any banks. without the explicit requirement that if we're helping you, you're reinvesting in americans. you're reinvesting in consumers and taxpayers and businesses. we just got to make that part of the ve knack lar. as the government gets engaged in keeping the banks...

Business. >> representative waters, can you respond to that? >> yes, i said that. yes, well, as you know, what we discovered with this foreclosure problem is that a lot of our financial institutions created these exotic products. no money down, resets where people could get in for very little money, and they reset the interest rates, kwquadruple, th liar loans, we discovered fraud, we discovered why there was this sub prime meltdown in this country, a lot of it was fraud. a lot of it was the financial institutions knew what they were doing, and they absolutely led this country down the drain. ...