Greenspan was the modern day "Emperor without Clothes". He set the stage for this and the only remedy is letting the chips fall where they may. Greenspan was a fool to lower rates as low as he did and he knew a Bond bubble would come out of it. Either that or he believed his own bs that he use to spout off to Congress. John
What I mean is - he is fully aware of the results that his actions will bring about, but he is doing them for the Feds own unique reasons. He has a number of people he can refer to, all with advanced degrees in Business/Economics, its not like he is the only person who decides thing. Just like Bush is not the only person who decides what happens in America - many people work behind the scenes.
Don't forget Bush and the republicans/democrats in congress. They could've ended the no doc., interest only loans from the loan sharks thru legislation - if they weren't all bought and paid for. Worst political/economic leadership in over 200 hundred years. I think their approval rating will drop sub 5% - after all is said and done. Ron Paul for president, anyone?
There was no reason to for congress to get involved. Determining who can buy a house is not one of congresses duties. This is entirely Greenspans fault. He set the stage for this by dropping rates so low that it was basically free money for the financial guys to loan. You can't blame the mortgage industry. They were only doing what they are in business for. They could not have taken the risk of no doc, liar loans unless the Fed gave them free money. Bernanke is going to let the house of cards fall which is what he should do. John
You mean they have advanced degrees like the guys running those hedge funds that just blew up? They knew what they were doing too. Actually, I don't want to discuss this stuff rationally. Mainly I just want to knock Bernanke around. I mean, what kind of moron shoots his mouth off at a cocktail party trying to impress Maria B? I can think of one word: looooser. Was he fully aware of the results his actions would have then?
No way. I think congress should get involved and enact a mandate that people can get no doc interest only loans with teaser rates. Do we want to live in a country that denies poor people the right to speculate in real estate. I don't think so.
Do you want to live in a country where you and every other sane person that respects risk is forced to subsidize that poor guy's and his loan shark's loss?