Who caused the financial crisis? Peter Wallison: Five Years Later: Don’t Mention the Feds – WSJ.com

Remember the mortgage meltdown and the financial crisis? I was one of those weirdos who felt the root cause of the entire crisis was government policy aimed as increasing home ownership without regard to ones ability to pay, otherwise known as sub-prime and sometimes sub-sub prime mortgages.

Here is a very interesting look back at the situation you might want to read. By the way, you can still buy a house with only 3.5% down. Do we ever learn?

When it became obvious that government policy was at fault, even Barney Frank—at the time the chairman of the House Financial Services Committee and a principal backer of the affordable-housing goals—confessed that the policy had been misguided. On Larry Kudlow’s CNBC show in 2010, Mr. Frank said: “I hope by next year we’ll have abolished Fannie and Freddie. It was a great mistake to push lower-income people into housing they couldn’t afford and couldn’t really handle once they had it.”

via Peter Wallison: Five Years Later: Don't Mention the Feds – WSJ.com.