Thomas Sowell: Government helps create financial mess

Government helps create financial mess We don't look to arsonists to help put out fires, but we do look to politicians to help solve financial crises that they played a major role in creating. How did the government help create the current financial mess? Let me count the ways. In addition to federal laws that pressure lenders to lend to people they would not otherwise lend to, and in places where they would otherwise not invest, state and local governments in some parts of the country have so severely restricted building as to lead to skyrocketing housing prices, which have led many people to resort to "creative financing" to buy these artificially more expensive homes. Meanwhile, the Federal Reserve System brought interest rates down to such low levels that "creative financing" with interest-only mortgage loans enabled... [read full story]