Did Deregulation and Capitalism Cause the Financial Crisis?


Michael T. Griffith


Second Edition


The chief cause of the financial crisis was neither capitalism nor a lack of regulation; rather, it was unwise government intervention.  Beginning in 1995, the federal government began pressuring banks to make more home loans to low-income people in an effort to increase home ownership among the poor.  Prior to 1995, such subprime home loans constituted less than 2% of new home loans, but by 2000 they were over 9% of new home loans, and by 2008 they were 20% of new home loans.  To make matters worse, Freddie Mac and Fannie Mae began to buy and/or guarantee more and more of these risky subprime loans.  Freddie and Fannie, along with some private banks, then took these mortgages, bundled them, and sold them as mortgage-backed securities.  To make a long story short, if the government had not meddled in the mortgage industry, there would have been far fewer subprime loans to bundle into toxic assets in the first place, and the damage to our economy would have been vastly reduced.  Government intervention was not the only cause of the financial crisis, but it was the primary cause.


How Government Housing Policy Led to the Financial Crisis



The Real Culprits in This Meltdown



Let the Inquisition Start with Frank



The Culprit is All of Us: The Government’s Meddling Got Us Into This Mess



Blame Fannie Mae and Congress for the Credit Mess



Stop Covering Up and Kill the CRA



The Government Did It



The Financial Crisis and the CRA



The CRA Scam and Its Defenders



Some Relevant YouTube Links


Barney Frank’s Denialism About the Housing Bubble



Bush and McCain Warned Democrats of Housing Crisis and Financial Meltdown



Democrats Covering Up Fannie and Freddie Scandal



Democrats Blocked Reform of Freddie and Fannie





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