Dr. Doom's diagnosis
Uber-bear Nouriel Roubini was interviewed on the "Nightly Business Report" Tuesday night (here is a link to the transcript).
The first question and answer is the most interesting to me:
SUSIE GHARIB: Professor Roubini, who or what is the major culprit of this financial crisis?
ROUBINI: First of all the Fed kept interest rates too low for too long and created the housing bubble. Secondly the Fed and the other regulators were asleep at the wheel and allowed all these toxic mortgages to be created without controlling it. Three, there was plenty of greed and excessive risk taking on Wall Street. And four, the rating agencies had major conflicts of interest because they were being paid by those that were supposed to be rating. So the blame is to be shared by many different culprits.
I pretty much agree with this and for those with really really short attention spans, let me point out that half of the reasons point to the Fed. There is always greed on Wall St. but the blindness to the riskiness of it all was truly staggering.
Hat tip to Tim Iocono