In addition to the outright BRIBES from lobbyists (can we seize their funds first?) we have another reason for the policies. Greenspan in his last book says he was very worried about income inequality and stopping potential seeds of populist revolt.
Greenspan says he believes looser mortgage terms for “subprime” borrowers — those with spotty credit histories or low incomes — raised financial risks. However, he said, the benefit of expanded home ownership in the United States was worth the risk.
At his re-confirmation hearing before the US Senate Banking Committee in 1996, he said that he did not want to discriminate against individuals who were not wealthy and therefore needed to borrow in order to play the stock market (sic). As he well knew, the traders buying stocks on margin were mainly not poor and needy but professional traders out for a free lunch, which Greenspan well knew. Interesting, however, was that that was precisely the argument Greenspan would repeat for justifying his advocacy of lending to sub-prime poor credit persons, to let the poorer get in on the home ownership bonanza his policies after 2001 had created.
