Proof government policies brought down the housing market
May 12, 2012 |
I firmly believe that it is government intervention in free markets which cause recessions and depressions. The market, left alone, corrects itself quickly, and doesn’t get itself into deep holes. Any deep holes that we are in are the direct of market perturbation by the state.
This excellent, thoroughly researched piece was a rebuttal to the FCIC, a bipartisan government-created body who was supposed to fully research the 2008 crisis and return conclusions, but of course ONLY those conclusions which point to corporations as the culprit. As the following article shows, the fact is that is was government intervention all along which caused the crisis.
I used to work with a guy who would surreptitiously cause a server to fail remotely so he would have to drive into the office to fix it, and rack up overtime. When we was discovered, he was fired. Here we discover the truth, and just give government more power and money to solve the problems they themselves created.
I think we need to fire a few folks. More than a few.
Today, the United States has the most troubled housing market in the developed world. It’s also the only developed country with a major government role in housing policy.
In less than twenty-five years, “affordable housing” and other housing policies have turned a healthy market into a financial ruin. In 1989, for example, only 1 in 230 homebuyers made a down payment of 3 percent or less; by 2007, it was 1 in 3. Meanwhile, average home equity plunged from 45 percent to 7 percent.
The policies that caused the financial crisis are still in force. Until they and the government’s role in housing are eliminated, the US housing market will not return to health.
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