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Originally Posted by forrestlayne  It is just not only this policy but lots of others as well. This mess is the result of many government intervention policies. The Federal Reserve leaving interest rates way low (Alan Greenspan years) also plays a part. The only reason banks were able to loan money on questionable mortage loans is because they could pass off the loans to Freddie and Frannie.
Everytime the government tries to set up policy someone always loses..usually the US taxpayer. |
Frannie and Freddie don't hold the lion's share of these bad mortgages. They belong to the free markets. Greenspan did keep rates artificially low. He also encouraged lenders to be more creative in their lending practices.
You cannot say that every time the government tries to set policy the taxpayer loses. You can say that Republicans are very bad at governing if you like. The current administration is a prime example of that. Like the Reagan administration, the middlee class fared poorly.