- While Mr. Greenspan acknowledges that he could have done something to avert the housing crisis, he contends his hands were tied.
“If we tried to suppress the expansion of the subprime market, do you think that would have gone over very well with the Congress?” Mr. Greenspan said. “When it looked as though we were dealing with a major increase in home ownership, which is of unquestioned value to this society — would we have been able to do that? I doubt it.”
Well, I question it. I have nothing against homeownership, but it isn't right for everyone. Obviously it isn't right for people who can't afford their mortgages after the teaser rate expires. It isn't right for people who need more geographic mobility due to the nature of their jobs or other reasons. It isn't right for people who don't want to invest time in being the "super" of their own building; houses require significant upkeep to main a roughly constant level of quality.
As for Greenspan's ability to anything... if nothing else he shouldn't have encouraged lenders to provide "greater mortgage product alternatives to the traditional fixed-rate mortgage. "
(ht reader a)