Thursday, October 23, 2008

The Failure of the Regulated Market

Andrew Medworth has written an excellent article which uses Austrian economic principles to explain the nature of the current financial crisis. I agree whole-heartedly with his view that the Fed's interest rate policies created the bubble (and thus are the root cause of all the subsequent problems), while various other government programs (GSE's, CRA, etc.) shaped it -- giving rise to a boom in housing in particular.

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