Being raised in Italy, I have first hand knowledge of the damage created by big governments. Italy is collapsing. Spain, with the same malaise as Italy, is following the same path. France is also in trouble.
Our housing bubble was caused by big government and an amazing network of regulations and agencies. And yes, by cheap money.
This is what Ron Paul writes. "The House passed two bills attempting to rehabilitate the housing and mortgage market this week. There doesn't seem to be any shortage of criticism and blame for the bad decisions, and rightly so. Lenders and banks do share much of the blame for the overheated market.Lending standards were relaxed, or even abandoned altogether, creating an exaggerated pool of home buyers that led to ballooning home prices that many, especially real estate investors, expected to continue forever. Now that the bubble has burst, the losses are staggering."
"However, many in Washington fail to realize it was government intervention that brought on the current economic malaise in the first place. The Federal Reserve's artificially low interest rates created the loose, easy credit that ignited a voracious appetite in the banks for borrowers. People made these lending and buying decisions based on market conditions that were wildly manipulated by government. But part of sound financial management should be recognizing untenable or falsified economic conditions and adjusting risk accordingly. Many banks failed to do that and are now looking to taxpayers to pick up the pieces. This is wrong-headed and unfair, but Congress is attempting to do it anyway."
My point. Big governments create problems and then they become even bigger as they attempt to solve the problems they created. This is the lesson of history.
More, much more on https://www.peterdag.com/.
George Dagnino, PhD
Editor, The Peter Dag Portfolio
Since 1977
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