Thursday, March 22, 2007
In a all too typical fashion, the free market gets the blame for government failings, as Emory Rushton, the U.S. Office of the Comptroller of the Currency's senior deputy comptroller, blames so-called "abusive lenders" for the sub-rime mortgage crisis. He does blame the Fed, sort of, but he faults them for not regulating enough. But the real problem was that the Fed held interest rates too low for too long time and thus provided these lenders with the money they needed for their "abusive lending". The Fed was thus the real "abusive lender" and the Fed is thus responsible for the subprime mortgage crisis.