wdhalgren

Regional Bank Collapse: No Moral Hazard Here

No one ever said that moral hazards don't end badly. The current state of the financial sector is a direct result of government encouraging irresponsible home lending, via GSE subsidization of mortgages at below market interest rates and securitization of poor risk loan pools. Current government interventions in the free market process will lead to greater pain down the road. How that will manifest may not be known at present, but rest assured it will manifest.