More foreclosures coming

The number of long-term adjustments completed under the president's foreclosure prevention plan rose to 66,465 at the end of December, or 7.4% of all trial modifications started, up from 31,382 a month earlier. Another 46,056 modifications are pending borrowers' final signatures, according to Treasury statistics released Friday. Another 48,924 were denied permanent modifications, mainly because they did not make their trial payments on time, did not hand in the needed paperwork or did not meet the program's criteria. Meanwhile, the number of delinquent homeowners in trial modifications rose to 787,231, up from 697,026 a month earlier.

Housing experts remain concerned that the rate of foreclosures still outpaces the help homeowners are receiving under the program. A record three million homeowners received at least one foreclosure filing in 2009, according to a RealtyTrac report released last Thursday. A lot of borrowers are too far underwater or don't have enough income to qualify for a permanent modification, said Celia Chen, senior director at Economy.com. Others will not be able to provide all the documentation needed. Administration officials said they continue to review the program to make sure it is helping those in need, Chen said she doesn't think there's anything the government can do to keep these borrowers in their homes. "As more of these loans fail to make it to permanent modifications, a lot will go back on the market as foreclosures and that will depress home prices," said Chen, who expects home prices to fall another 10% by the third quarter of this year.

President and Democrats trying to whip up populism in Massachusetts

The Democrats and the White House are scrambling to salvage the special U.S. Senate election in Massachusetts by trying to whip up a populist furor over banks. Amid reports that financial institutions bailed out by the government are enjoying healthy profits and paying generous bonuses, and as a bipartisan commission began hearing testimony on banks' role in the economic crisis, Senate candidate Martha Coakley (D), Vice President Joe Biden and others used the issue to portray Ms. Coakley, who is vying to succeed the late Edward Kennedy, as tough on bank executives and Republican Scott Brown (R) as coddling them. This sort of anti-bank populism was popular in the 1930s by demagogues like Father Coughlin, but rarely has a president engaged in this sort of bare knuckle politics to save his agenda. Polls show declining voter enthusiasm for Mr. Obama's health-care plan, and Brown has campaigned on a promise to provide the 41st GOP vote to secure a Senate filibuster to scuttle a health-care bill.

Democratic strategists concede Mr. Obama's support in the past for a Wall Street bailout has fueled voter anger, particularly among conservatives and supporters of the anti-establishment Tea Party movement who are pouring money and volunteer hours into Mr. Brown's race. With the bank tax, "we can take populism back to our side," a Democratic Party strategist said. Mr. Brown he opposed the tax because it would most likely be passed on to consumers through ATM fees, among other things. He said banks would have to pay a hefty tax rather than use the money to extend much-needed loans to small businesses. "If you're having an uphill battle selling health care in a blue state like Massachusetts, that should send shivers down the spine of Democrats looking at races across the country," said Brian Walsh, a spokesman for the National Republican Senatorial Committee. A new Suffolk University poll finds Republican Scott Brown leading Democrat Martha Coakley, 50% to 46%. If Brown wins , ObamaCare dies. He would be the 41st vote to prevent any compromise legislation from coming to the floor of the Senate.

Chris McLaughlin; Loss Mitigation Institute