Libertarian Economic Policies Would Have Prevented the Housing Bubble & BustSubmitted by bobbyw24 on Tue, 03/29/2011 - 07:45
Libertarian Economic Model
The Libertarian model does not end all regulation. Indeed the basis of the Libertarian economic model is that we need to protect private property, prevent fraud, protect human rights, and give everyone an equal chance under the law.
Had we done that, and "just" that we would not be in this mess.
In the Libertarian model, Fannie Mae and Freddie Mac would not have existed. Nor would there have been a Fed keeping interest rates too low, too long. Without the loose lending model of the Fed, and without banks being able to lend more money than they have, the housing securitization model that blew up would not have happened or if somehow it did, it would have been less problematic by orders of magnitude
In the Libertarian model, there would not have been government sponsorship of the rating agencies Moody's, Fitch, and the S&P.