the Mortgage mess Do I have this right?
In an effort to keep inflation at bay, the federal reserve drops interest rates to combat that, and the horrendous deficit this war is racking up. So the lower the prime rate goes the cheaper money is and the more they have to lend to people who really have no right borrowing that kind of money in the first place. As a result once their sub prime loans come due they cant afford to pay their loans and they default, killing any loaning or borrowing of any kind including student loans and the whole house of cards crumbles. The govt doesn’t have the funds to pay for anything so they borrow more to cover it?
Is that what’s happening?
Isnt this how depressions are made and whose fault is it?