….Bailing out the financial system was the equivalent of bailing out everybody. The bailout of the financial system was necessary….[/quote]
A lot of people believe that creating or sustaining asset bubbles is a victimless crime.
In fact, inflating the price of any good benefits the seller at the expense of the buyer. It’s a tax on buyers and a subsidy for sellers. Are homeowners the most deserving recipients of subsidies in our society, with those owning the most expensive homes being the most deserving of the deserving? And are home buyers the ones who most need to have additional money taken from them?
It’s an interesting theory that this system of implicit taxes and subsidies for home buyers and sellers is necessary for a healthy economy. It doesn’t make any economic sense, but it is interesting.
