He defines "moral hazard" and points out that one of them is the Federal Reserve's habit of bailing out problem debtors. When you subsidize an activity, as the Fed clearly is doing here, you get more of it, and the Fed is doing this in the worst possible way; by buying mortgage backed securities.
Look for the housing crisis to deepen, and another one to occur in about a decade as another inflationary cycle persuades borrowers to contract risky debts.
It’s Raining Walz
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The Governor’s “State of the State” was last night. And Berg’s 24th Law was
in full effect: Progressive politicians can, and routinely do, say anything
the...
19 hours ago
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