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You can't spend your way out of a recession

You can't spend your way out of a recession

  • Total voters
    70
Ethereal said:
I'm not saying they weren't partially responsible, but absent several government policies their irrational and excessive speculation would've been impossible.
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That is true and both sides of the aisle are responsible. Clinton largely dismantled the regulation of the financial industry back in the 90s, which both allowed the .com success, but the current crash as well. Bush, who had every chance to replace the regulations, refused to do so even though he was warned of upcoming potential problems. There's plenty of blame to be spread around and it's not like people didn't see it coming. It's just that when the economy is doing well, nobody wants to actually think that it just might come to an end.
 
the makeout hobo said:
Which policies?
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Housing subsidies, non-discriminatory lending policies, expansionary monetary policy (although some would disagree with me on that one), Freddie and Fanny, tax disincentives for savings.
 
Ethereal said:
Housing subsidies, non-discriminatory lending policies, expansionary monetary policy (although some would disagree with me on that one), Freddie and Fanny, tax disincentives for savings.
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I think those may have had some impact, but at the end of the day, the banks found a way to make money quick. They had this whole house of cards set up to make them money, without caring about the long term effects
 
the makeout hobo said:
I think those may have had some impact, but at the end of the day, the banks found a way to make money quick. They had this whole house of cards set up to make them money, without caring about the long term effects
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And the government was goading them on. A bubble may have still occurred, but it probably wouldn't be nearly as large. With the Fed's money policy at the turn of the millennium, a large amount of irresponsible lending was inevitable.
 
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