There is a lot of commentary blaming the subprime mess on government pushing home ownership. I say no.
Look, the Fed dropped interest rates to low levels. People starting buying homes, re-financing, and getting home equity loans because of the low rates. This drove up the price of homes, but in my opinion, the subprime mortgage business grew out of the fast rising cost of homes and the need to get more business, which a portion of which was driven by government wanting to grow home ownership. But, again, no one told companies to make 100s of thousand dollar loans without paperwork.
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