Understanding How Greenspan and California's Foreclosure Law Will Play in the Financial Crisis Debate

Two must reads for you today. While Why You Care was posting our futures calendar (Next Week's News Today) yesterday, former Federal Reserve Chairman Alan Greenspan was making news on Capitol Hill, we've narrowed down the mountain of coverage to one story on it that you'll need to read in order to understand the debate in the weeks and months (likely years) to come.

Plus, we have a forward looking article on how California has slowed the foreclosure process... at least temporarily. This will also be part of the public debate over solutions, so you'll want to understand it now.

First to Mr. Greenspan -

Here's why you care: The Wall Street Journal's Kara Scannell and Sudeep Reddy have a terrific write deciphering what Mr. Greenspan had to say and how the lawmakers questioned him. You need to read this piece because his testimony will be used in much of the public debate over how much regulation is needed, and where to find a balance between regulating and over regulating. You're going to see it again and again, so it is well worth your time.

Now to California's foreclosure process -

Here's why you care: The must read LA Times story by William Heisel, Marc Lifsher and Maura Reynolds shows that California has done something inventive - put a law in place this past September requiring lenders to wait 30 days after contacting the defaulting borrower (or making reasonable efforts to) before initiating the foreclosure process. Why this article is a must read is because the result is still a jump ball. Yes, the reporters note the process has slowed, but their reporting also illustrates it is unclear whether the desired result is achieved: More lenders and borrowers working out loans instead of turning to foreclosure. Time will tell, but you can bet other state lawmakers are watching this. And they are reading this story - so should you.