Krugman: Spend Now, Save Later

[richardhutnik]

mrstickball said:

numonex said:

 

Due to the lack of controls in the financial  system in the US and around the world there has been an inflationary gap between supply and demand. 

The sub-prime mortgage fiasco was a result of financial deregulation which allowed banks to issue out 100% finance with no repayments aka Ninja loans. 

Did you ever read up on the Community Reinvestment Act of 1999?

Did the Community Reinvestment Act of 1999 hold a gun to the head of banks and order them to do what they did with the financing they did, to dice and slice and rebundle it and label it all AAA?  Did the government tell the rating agencies to make the ratings of the investments lower risks than they were?  Did they also tell then to engage in credit default swaps?