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Politics : Politics for Pros- moderated -- Ignore unavailable to you. Want to Upgrade?

To: TimF who wrote (279577)	11/8/2008 8:42:04 PM
From: cirrus	Read Replies (1) \| Respond to of 793917

Weren't mortgage interest deductions and zero/reduced cap gains on primary homes fixed in policy long before Carter? Whenever they came along I don't think they had much to do with the current mess. The current issue of FORTUNE has an interesting analsis of the mortgage mess. It's too long to detail here, but it essentially blames poor risk management models, artificially low interest rates and the assumption that housing prices would never fall nationwide. As far as Fannie and Freddie, institutions having little to do with these two were also affected. It's complex, and the only thing I can wrap my brain around in this mess are the banking regulations (or lack thereof) that let folks who could barely afford a 1% rate take on a variable rate mortgage.