[lbo-talk] Goolsbee: subprime was pretty groovy (in 2007)

Doug Henwood dhenwood at panix.com
Mon Dec 1 04:38:39 PST 2008


On Dec 1, 2008, at 7:14 AM, Michael Smith wrote:


> The original (narrower)
> one here was whether handing out mortgages like Mardi Gras beads
> was in itself a Good Thing as far as it went -- spreading the wealth
> etc.

Lending lots of money to buy an unproductive asset like housing does nothing to spread wealth around. It spreads debt around and inflates prices. Until the bubble bursts, that is.

Doug



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