2000s Housing Market (Sowell and Murphy)

2000s Housing Market (Sowell and Murphy)

by Weslee Sheldon -
Number of replies: 1

In Sowell's video, he represents a few main factors that lead to the bubble in the 2000s housing markets. These factors would be: government policies pushed home-ownership, which lead to a people lending money to higher risk borrowers; banks had relaxed lending standards and issued subprime mortages; the government backed these relaxed banks for them to keep loaning out money; the interest rates were at a low in the 2000s; and people bought houses at a higher price expecting them to keep rising, and make a profit off of them. 

Murphy's video primarily had points that argued of the unseen affects of the government intervening. These points would be: people focused on the immediate benefits and not the long run; the resources used by the government were pushed to this rather than things needed elsewhere; the government spending didn't lead to new wealth, but distributed it instead; and their policies could be good at first-glance, but have hidden harm that causes ripple affects later.

In reply to Weslee Sheldon

Re: 2000s Housing Market (Sowell and Murphy)

by Josiah Smith -
I like how clearly you put everything out. You not only have provided information, but also organized it by video. Overall you have great points. The government fueled desire for home ownership and means to take steps towards it, but at the cost of market stability.
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