Federal Reserve – Housing Bubble

September 23, 2007 at 12:23 am | Posted in Uncategorized | Leave a comment

To: Chairman Ben S. Bernanke
From: Eric Janszen, President, iTulip, Inc.
Subject: Congressional Testimony and Fed Credibility
Date: September 21, 2007

Dear Chairman Bernanke,Reading your testimony “Subprime mortgage lending and mitigating foreclosures” before the Committee on Financial Services, U.S. House of Representatives September 20, 2007 I am compelled to comment. Two assertions in your testimony in particular drew my attention.In your testimony you state: “As I noted in a speech last month at the economic symposium hosted by the Federal Reserve Bank of Kansas City, the turbulence originated in concerns about subprime mortgages, but the resulting global financial losses have far exceeded even the most pessimistic estimates of the credit losses on these loans.”

Evidence of the potential for substantial losses by investors in housing market related securities have been available from numerous credible sources since at least 2003, that is, for over four years. Research by the Center for Economic and Policy Research (CEPR), International Monetary Fund (IMF), and The Levy Institute is consistent with research by analysts at several major banks, including Credit Suisse and Northern Trust.

The blog then goes on and explains in great detail prior postings for years that advised that there was a housing bubble.

Read the full blog

http://www.itulip.com/forums/showthread.php?t=2066

Ron Paul on the Housing Bubble

Mr. Chairman, the situation facing us now in the mortgage industry has its roots in the Federal Reserve’s inflationary monetary policy. Without addressing the roots of the current crisis, any measures undertaken to improve the situation will be doomed to fail.

As with asset bubbles and investment manias in past history, the fuel for the current housing bubble had its origins in monetary manipulation. The housing boom was caused by the Federal Reserve’s policy resulting in artificially low interest rates. Consumers, misled by low interest rates, were looking to consume, while homebuilders saw the low interest rates as a signal to build, and build they did.


http://www.newsandpolicy.com/news/2007/09/ron-paul-the-fuel-for-the-current-housing-bubble-h.html

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