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Author: warrl Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 736103  
Subject: Re: Here We Go Again: CRA Back From the Dead Date: 1/25/2013 4:55 PM
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It doesn't take a Ph.D in economics to determine that if you demand banks make mortgage loans to people who don't meet normal lending criteria, the banks will be making lower-quality loans and more of those loans will go into default.

That's not what happened.


No matter how much the fact say it happened, the theory says it wasn't supposed to, so it didn't.

Government can't make Wall Street act against its own self-interest.*

No, but government can alter the environment so that it is in Wall Street's self-interest to do things that in a rational environment would be obviously unwise.
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