Rick Ackerman
The Times, the Journal, and other status quo purveyors of news must surely regard the mortgage crisis as something to be resolved in due time, presumably by an inevitable upswing in home prices and a little help from the central bank. But such thinking only confirms that they are as clueless now as they were when the real estate crisis reached critical mass nearly two years ago. And, we are certain, they will be equally clueless when the expected upswing in home prices fails to materialize and deflation tightens its death-grip on the U.S. and global economies.
By then, the praise and respect the news media have mindlessly heaped on former Fed Chairman Alan Greenspan will be under reconsideration. For the record, let us say that he has already been tried and convicted by the vast newsletter world as the main instigator of a credit blowout that could only have ended as this one is about to: in a global bust. Three generations after the start of the Great Depression, the eggheads, pundits and wonks are still looking for a culprit. Was it the Smoot-Hawley tariff? Too-tight credit after the market crashed? The next time around, when the saga of the Second Great Depression is told, they need look no further than a Federal Reserve that succeeded in turning the concept of “free lunch” into America’s one true mainstream religion.
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