Resident Fellow Alex J. Pollock

In "Market Mayhem" (July 30), Alan Abelson indulges in a bit of hyperbole, referring to the current situation as "the worst bust in housing in this nation's history."

Well, not quite.

In the early 1930s, the nation experienced a real collapse of the housing and mortgage markets: half of mortgage debt was in default; many savings and loan associations were unable to honor withdrawals from savings accounts.

The government set up the Home Owners' Loan Corp. to buy defaulted mortgages from lenders and it purchased 20% of the nation's residential mortgages. Some places, so it has been said, organized lynching parties to be ready for any sheriffs attempting to hold foreclosure sales.

The current housing and mortgage bust is ugly and will get uglier, but I don't think we'll need to revive the Home Owners' Loan Corp.

Alex J. Pollock is a resident fellow at AEI.