Government not bankers caused the housing debacle

Reader comment on: Blaming the Bankers
in response to reader comment: Typical

Submitted by Harry Binswanger (United States), Jul 11, 2017 00:13

The villification of bankers is vicious and cartoonish.. The titans of Wall Street are a much more moral breed, on average, than most other professionals--and certainly light years better than today's academicians and intellectuals.These bankers earned their positions and their wealth. Government officials--who dispose of the wealth created by others--did nothing but get elected (and we see in Trump how thin a reed that is to rest upon) or get appointed by another of their type.

Government intervention caused the boom and the bust.Specifically, Greenspan's near-zero interest rates during the early years of the new millenium and Fannie Mae's incredible drive to put everyone into a home, whether they could afford it or not. Fannie Mae just about took over the mortgage industry (then went bankrupt).

For a correct understanding of the causes of the crash, read John A. Allison's The Financial Crisis and the Free Market Cure.

Allison was head of BB&T, one of the top 10 financial institutions in the world. And due to his sound policies, his bank did not get into trouble during the crash (but the government forced BB&T to take TARP anyway).

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