Wednesday, November 9th, 2011
Ludwig von Mises explained that one government intervention leads to an endless succession of interventions to deal with the effects of the first and subsequent interventions. Ultimately, it comes down to two choices. “Either capitalism or socialism: there exists no middle way,” Mises wrote.
Likewise, there is no middle way to solve the housing crisis. For capitalism to work its magic and set underwater homeowners free, mortgage holders must be allowed to fail.
Best blog post I’ve read in a while summing up why we have an underwater homeowner problem, how we shouln’t fix the problem, and how we could.