Obama takes on housing crisis

Barack Obama has announced an ambitious plan to try to beat the US housing crisis but will face strong opposition from the banks.

The president wants to help borrowers refinance their existing mortgages to new loans with lower interest rates and cheaper monthly payments.

He insists they should be able to do this no matter how much the value of their home has dropped. Speaking at a stop in Las Vegas during a three-day trip to western states, he warned the banks and his Republican opponents: "Where they won't act, I will."

The measure is aimed at both helping homeowners struggling to make payments and stimulating the economy. It is a recognition that measures his administration has taken so far have not done as much as had been hoped.

America's sub-prime mortgage crash has been blamed for the 2008 financial crisis which engulfed the world.

Later in the week, the President will announce measures to make it easier for graduates to pay back theirs student loans. While Mr Obama has proposed prodding the economy with tax cuts and increased public spending, this is the first time he has made housing an election topic.

The combination of unemployment, depressed wages and mortgages that exceed house values has continued to put a strain on the US economy.

"There is no silver bullet," White House press secretary Jay Carney said and he acknowledged that the measures have their limits.