Rather, easy lending should be seen as a form a welfare in that the government takes over the risk of systemic failure in order to provide more home ownerships rights to lower-income individuals. In a society that values ownership over nominal wages, that might be a superior form of wealth transfer.
If, instead, the already lax lending standards had been further weakened (as they were after the .com crash in the early noughties), it is possible - not certain, but possible - that a new bubble could have been inflated to cover up the wreckage of the Coolidge bull market, the way "Bubbles" Greenspan and baby Bush covered up the .com crash with the subprime bubble.
- Jake If you only spend 20 minutes of the rest of your life on economics, go spend them here.
