balasr, that’s funny. Realtors are NOT to blame for any of this. Neither are mortgage lenders, appraisers, inspectors, title officers, buyers, or sellers. Money seeks the highest return. MBS investors, seeking higher yields, are the culprits, and they will be the ones stuck with the bad loans.
BUT, from where did the liquidity come in the first place? Japan took back its liquidity in the second quarter of this year. From where did it all come? Where did MBS investors get their money?
In regard to that article, I cannot believe that our government officials and policy makers would try to mislead us in public. They absolutely know what caused this bubble! They are smarter than I am and have access to much more information. However, we have to take with a grain of salt everything the Fed or policy makers say in public; much of their talks and “research” is aimed at making themselves look good, and in keeping the masses drugged with bad information.
In the next paragraph, please realize I have some of that liquidity stuff wrong, because I don’t fully understand it, so please correct me. But the general idea stands. Back to the report. Can you imagine the fallout if their report stated, “We caused this housing bubble with our loose monetary policy. We lowered interest rates below the rate of inflation hoping to jump-start capital spending, but did not realize we would create a housing bubble instead. To make it worse, the Federal Reserve issued so much debt, and flooded so many dollars into the system, that it was just begging for a place to go. Japan’s zero interest rate policy brought $300 bilion into the US, looking for an investment, and it flowed to MBS, making more and more easy credit available to Americans who had NO business every applying for a mortgage, much less getting one. Now millions of Americans are facing foreclosure, and there isn’t a damn thing we can do to help them. Excesses always cleanse themselves, so good luck with your cleansing. Don’t worry, as we will definitely raise your taxes, so you can do your American patriotic duty in bailout out your fellow GSEs, banks, and bankrupt cities. But don’t blame us, because we want you to like us. Please, will you not be too mad? Please, I just want you to say you still are my friend. Pleeeeaaaaase, will you be my friend???…”
Actually,