• The house price bubble, the most prominent global bubble in generations, was caused by lower interest rates but. … it was long-term mortgage rates that galvanized prices, not the overnight rates of central banks, as has become the seeming conventional wisdom.
• Former Federal Reserve Chairman (and all-around smart guy) Alan Greenspan • Speaking in business-ese about something which we can put much more simply: Low interest rates that allowed low-income people to buy houses didn’t cause the housing crisis. Instead, the culprit was a couple levels up the food chain. Speak English, Alan. (Greenspan, by the way, is attempting to defend his legacy here.) source

Posted by Ernie Smith • Permalink