” … The financial crisis was not caused by lending to people who could not afford the homes that they were purchasing.
The crisis was caused by the bubble in the real estate markets, most noteably in Las Vegas, SoCal. South Florida and believe it or not South Carolina….”
So many new buyers coming into the market with the ability to buy houses above their means drove up housing prices. Some buyers who bought several properties and flipped them got solid loans but many were also people who bought above their means.
This bubble could have happened without lax lending rules, say if housing stock is way below number of people desiring to buy a house and with enough income to get a solid loan. Bubbles happen anyway.
Most economists do NOT agree with Obama’s plans. 200 of them including several Nobel winners recently took out an ad in major newspapers to tell him so. When he says most economists agree with him he is lying.
