(Kennedy Smith isn’t a wino, he’s a Why, Yes! Stop by his refrigerator box beneath the overpass @TheKennedySmith)
There are a lot of theories about who’s to blame for the collapse of the financial sector: greedy bankers, sloppy regulators, the ever-popular “speculators”, the cast of Glee, and derivatives. We always blame those we don’t understand.
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Turns out the reason is very easy to understand. It was caused by a housing bubble. A bubble meaning inflated and unsustainable prices. These were created by government policy. Peter Wallison goes to town (in The Atlantic, of all places!) on Barney Frank’s attempt to conceal this basic truth:
Congressman Frank, of course, blamed the financial crisis on the failure adequately to regulate the banks. In this, he is following the traditional Washington practice of blaming others for his own mistakes. For most of his career, Barney Frank was the principal advocate in Congress for using the government’s authority to force lower underwriting standards in the business of housing finance. Although he claims to have tried to reverse course as early as 2003, that was the year he made the oft-quoted remark, “I want to roll the dice a little bit more in this situation toward subsidized housing.”
People who “roll the dice” and plunge us into the biggest worldwide crisis since the Great Depression should be in jail, not laughing all the way to a bailed out bank.