All Commentary
Wednesday, April 11, 2012

Subprime Lending Returns


“[A]s financial institutions recover from the losses on loans made to troubled borrowers, some of the largest lenders to the less than creditworthy, including Capital One and GM Financial, are trying to woo them back, while HSBC and JPMorgan Chase are among those tiptoeing again into subprime lending” (New York Times)

It’s called moral hazard.

FEE Timely Classic
“The Subprime Crisis Shows that Government Intervenes Too Little in Financial Markets? It Just Ain’t So” by Lawrence H. White