We've been fans of Danish economic policy for years here at TNR. Now I see from George Soros (via Matt Yglesias, via Justin Fox) that their mortgage market is also worth emulating:
Finally, the asymmetric nature of American mortgages is replaced by what the Danes call the Principle of Balance. Every mortgage is instantly converted into a security of the same amount and the two remain interchangeable at all times. Homeowners can retire mortgages not only by paying them off, but also by buying an equivalent face amount of bonds at market price. Because the value of homes and the associated mortgage bonds tend to move in the same direction, homeowners should not end up with negative equity in their homes. To state it more clearly, as home prices decline, the amount that a homeowner must spend to retire his mortgage decreases because he can buy the bonds at lower prices.
Fascinating. (And, Soros explains, potentially workable in this country.)
--Noam Scheiber