For starters, the U.S. Small Business Administration plans to match $2 billion in private sector investment over the next five years. That's a welcome contribution, but it'll hardly move the needle in a venture-capital market that saw $21 billion in investment last year alone. Fortunately, this year Intel Capital will be providing $200 million in new investments, and IBM will throw another $150 million at some startups.

Next, the government aims to enlist Brad Feld and TechStars to create 25,000 jobs by 2015. There are currently 14.5 million unemployed in America.

And then there are the oft-promised green jobs:

Our Nation's research agencies are actively engaged on this topic. Building on the success of last year's inaugural i6 Challenge, the Economic Development Administration will launch the $12M i6 Green Challenge in collaboration with research agencies focused on proof-of-concept centers that accelerate technology commercialization, regional economic development, and environmental sustainability.

If it's anything like the i6 Challenge, this initiative will provide a million or so dollars to a handful of organizations scattered around the U.S. The government is also taking suggestions for making it easier to start businesses.

There's always the off chance that the government will help a small-time firm become the next Google or Facebook, and statistics support the notion that startups are a major source of employment growth. Still, the scale on which the administration is operating makes it seem like it's much more interested in looking like it knows what a startup is than leveraging American entrepreneurship into a new American bull economy.

mtaylor [at] observer.com | @mbrookstaylor

"As we review the affected files in the 23 judicial states and take any needed remediation, the foreclosure process continues," said Gina Proia, a spokeswoman for GMAC Mortgage."

Just as it had joined Bank of America as one of the only firms to halt foreclosures in all 50 states, GMAC now joins BofA as one of the first companies to restart its mortgage operations. Bank of America announced Monday that it was kicking its foreclosure procedures back into gear and today expressed confidence in its paperwork.

GMAC's announcement comes as major banks are working to assuage investor concerns that poorly prepared mortgage and foreclosure paperwork could come back to haunt them in the form of investor putbacks, homeowner lawsuits and regulatory action. Attorneys general in all 50 states have announced a joint investigation into lenders' practices after depositions by lender employees revealed fraudulent processing of foreclosure documents. On Friday, reports emerged that the SEC has started its own inquiry into the matter.

mtaylor [at] observer.com | @mbrookstaylor

She said that the bank's foreclosure review will impact fewer than 30,000 home sales, and the company will work to remedy 102,000 foreclosures across 23 states. Fellow giant bank JPMorgan Chase said earlier this week that it was reviewing 115,000 loan files.

Desoer's comments stand in contrast with the current perception of Bank of America, which is currently being punished by investors and analysts for fear that costs associated with shoddy foreclosure paperwork could prove overwhelming for the bank. Of the major U.S. lenders who have suspended foreclosure activity, Bank of America is the only one to have stopped foreclosures in all 50 states. It has also become, in a way, a bellwether for the foreclosure crisis thanks to its 2008 acquisition of Countrywide Financial, which at the time was the nation's largest mortgage originator.

Meanwhile, attorneys general across all 50 states are launching a joint investigation into improper foreclosure filings by banks. JPMorgan, Ally's GMAC, BofA, PNC and Goldman Sachs have all slowed down their foreclosure processes in recent weeks in response to the budding fiasco.

Related: Eight Head-Shaking Horror Stories From the Foreclosure Crisis

mtaylor@observer.com

Twitter: @mbrookstaylor

"[T]he FOMC is prepared to provide additional accommodation if needed to support the economic recovery and to return inflation over time to levels consistent with our mandate," Bernanke said. At the same time, he acknowledged that the effects of Fed purchases of long-term debt securities are not quite known, and so the central bank should be careful:

One disadvantage of asset purchases relative to conventional monetary policy is that we have much less experience in judging the economic effects of this policy instrument, which makes it challenging to determine the appropriate quantity and pace of purchases and to communicate this policy response to the public. These factors have dictated that the FOMC proceed with some caution in deciding whether to engage in further purchases of longer-term securities.

Bernanke said that the risk of deflation is still present, and that there's reason to believe that inflation may stay at current low levels for a long time -- a situation that he feels the Fed should act on. But he didn't give any additional signals as to what action the central bank might take.

There is one solution on the table. By convincing Americans that the Fed is targeting inflationary policy, the bank may be able to encourage people to spend dollars. However, it's difficult to tell the extent to which the Fed's words alone would influence the markets. In any case, if Bernanke sees the way forward, he hasn't told us what it is.

As Fortune points out, shares of Bank of America today hit a 52-week low in what appears to be a signal that the markets are concerned that the mounting crisis could wrack the with severe troubles. Putting a fine point on the matter, Standard & Poor's Equity today stripped BofA of its "buy" rating, saying, "[W]e have a lower level of confidence (than we do for J.P. Morgan Chase), that BAC has adequately prepared for, and reserved for, future mortgage repurchase demands from the GSE's and investors, and for the potential administrative and legal costs of the rising foreclosure crisis."

The downgrade comes as attorneys general in every state ramp up inquiries into potentially widespread fraud and faulty paperwork related to a rising tide of foreclosures. In September, bank seizures of homes topped the 100,000 mark for the first time ever. And now the market is worrying that banks could be held liable to investors who bought securities that were made up of shoddy, legally questionable mortgages.

BofA rival JPMorgan Chase disclosed earlier this week that it set aside an additional $1.3 billion to safeguard against legal hassles -- mortgage-related and otherwise. Analysts asked a few questions about potential mortgage liability on JPMorgan's quarterly earnings conference call, but matters related to investors in mortgage securities weren't on the front burner. It's likely that Bank of America won't get off so easy when it fields its third-quarter call on Tuesday.

mtaylor@observer.com

Twitter: @mbrookstaylor

Peter Ticktin, a Florida lawyer who defends homeowners in foreclosure, tells the Associated Press that people who formerly held assorted service-industry positions were plopped into back offices at big banks and tasked with robotically signing thousands of foreclosure documents. The resulting incompetence defies description, but the AP has a go at it anyway:

In depositions released Tuesday, many of those workers testified that they barely knew what a mortgage was. Some couldn't define the word "affidavit." Others didn't know what a complaint was, or even what was meant by personal property. Most troubling, several said they knew they were lying when they signed the foreclosure affidavits and that they agreed with the defense lawyers' accusations about document fraud.

Fine, but those depositions may just represent a series of isolated bad hires that don't reflect any sort of systemic dysfunction. A more pervasive problem would require an industry-wide culture of neglect at some of the largest nationwide mortgage lenders, right? In such circumstances, bankers would inevitably come up with some new lingo to describe the phenomenon. In that case, we'd know the rotten paperwork was widespread. Oh, what's that, New York Times?

At JPMorgan Chase & Company, they were derided as "Burger King kids" - walk-in hires who were so inexperienced they barely knew what a mortgage was.

Similar employees at Citigroup and GMAC, says The Times, "sometimes tossed the paperwork into the garbage."

As monthly foreclosure volume passes the 100,000 mark for the first time ever, the level of sloppiness, sloth and carelessness perpetrated by banks also appears to be breaking records.

Barry Ritholz is calling for everyone who has suffered any transgressions -- wrongful foreclosures, lock changes, you name it -- to file criminal charges and create a voluminous paper trail implicating the banks. Under the circumstances, that looks like a good idea.

Hopefully the District Attorneys' offices don't use the same hiring tactics the banks did to cope with the mountains of paperwork that now threaten to pile up at their desks.

mtaylor@observer.com

Twitter: @mbrookstaylor

In a pre-recorded video that was played for a conference audience in Airport City, Israel, Buffett said the worst is over but the economy will continue growing at a very slow pace.

Buffett just last week said he thought that stocks were undervalued and that bonds, which have been on an upward tear, were overpriced.

Back in September, Buffett said the U.S. economy is not headed for a double-dip recession and that he's a "huge bull on this country." Although that prognostication may appear to differ markedly from Buffett's current view that America is in for economic pain, it helps to remember that the octogenarian investor is famous for taking an extraordinarily long view. As such, his short-term predictions may differ with longer-term attitudes.

mtaylor@observer.com

Twitter: @mbrookstaylor

Unlike its rivals, Citi is plowing ahead with foreclosures, but it has stopped initiating new business with a Florida law firm that is under investigation by the state's attorney general for improper foreclosure filings. Citi said it's not having the firm, the Law Offices of David J. Stern, handle new proceedings. Bloomberg reports:

"Pending the outcome of the AG's investigation, Citi is not referring new matters to this firm," the New York-based bank said in an e-mailed statement. Citigroup services loans for government-sponsored entities, such as Fannie Mae and Freddie Mac. Stern "was approved by the GSEs during the time in which it was retained by Citi," the bank said.

Citi also maintains that it doesn't have much reason to believe that its employees have been cutting corners, and for that reason it is not putting a halt to foreclosures.

Attorneys general in 40 states are expected to announce a joint investigation into foreclosures by America's big banks, according to Bloomberg. Major mortgage players Bank of America, JPMorgan Chase, Goldman Sachs, Ally's GMAC and PNC have all gone one further than Citigroup by calling widespread halts to foreclosures while they check to make sure their paperwork is in order.

mtaylor@observer.com

Twitter: @mbrookstaylor

Already honored with internet-meme status, the movement to halt foreclosures has now reached a new high. Litton Loan Servicing, Goldman's mortgage-servicing business, now joins mortgage big boys Bank of America, GMAC (part of Ally), PNC and JPMorgan Chase. Unlike BofA, which has taken its moratorium coast to coast, Goldman is suspending only some of its foreclosures.

"Litton Loan Servicing has suspended foreclosure proceedings in certain cases while it completes a review of its procedures," Donna Marie Jendritza, a spokeswoman for Litton, said in an e-mailed statement to the press.

If Goldman's in on the foreclosure suspension game, it's hard to imagine anyone who would be immune.

mtaylor@observer.com

Twitter: @mbrookstaylor

Nazi allusions aside, The Journal takes the position that the legal issues that are throwing countless foreclosures into legal limbo are mere technicalities. The main point, says the paper, is that people who failed to pay their mortgages deserve to lose their homes -- they bought things they couldn't afford, and that's what happens. Plus, The Journal says, inventory needs to come to market for home prices to bottom. The legal wrangling promises to draw out this process and hurt the economy.

Barry Ritholz over at The Big Picture chafes at one particular paragraph concerning whether any of the poorly executed foreclosure documentation has actually harmed anyone. The Journal says:

We're not aware of a single case so far of a substantive error. Out of tens of thousands of potentially affected borrowers, we're still waiting for the first victim claiming that he was current on his mortgage when the bank seized the home. Even if such victims exist, the proper policy is to make them whole, not to let 100,000 other people keep homes for which they haven't paid.

Ritholz's conclusion: The editorial board at the WSJ comprises either a bunch of clueless dolts or a bunch of bald-faced liars. (In the spirit of fairness, he also floats the possibility that the editorial board is a group of "high functioning morons.") He points out that Bank of Amerca foreclosed on a guy who didn't have a mortgage. For many, the fact that a bank seized a home from a person who owned it outright would be enough to call the documentation process into question.