The people who pushed making loans easier and easier to get thought they were doing something morally right. They would have viewed it as a moral hazard not to make such loans.

But, of course, even they now pretty much say that things went too far. Barney Frank said the other day “Sure I wish that we had regulated Fannie and Freddy more but I would also like to eat more and not get fat. And after all, the Republicans had control of Congress, so they could have done it.” The head of ACORN said last week “Sure, we advocated low interest loans but how were we to know that the financial institutions would use them as they did?”

So the moral hazard was that you were not supposed to use the low interest loans meant for poor people to buy a couple of extra houses and sell them after a few years for a 20% markup. And you were not supposed to do that over and over again.

The problem with Morality is that there are so many different flavors of it. One man’s morality is another man’s opportunity.

And as Canada Bill Jones famously said “It is morally wrong to let suckers keep their money.”