There is plenty of blame to go around for the U.S. housing bubble, but not much of it belongs to Fannie Mae and Freddie Mac. The two giant housing-finance institutions made many mistakes over the decades, some of them real whoppers, but causing house prices to soar and then crater during the past decade weren't among them.
Mark ZandiThe discussion in Washington has changed dramatically. I mean, it's no longer a question of should we address entitlements - it's no longer a question of do we need to reduce spending in the future.
Mark ZandiThere are different flavors of recession. You can get into some pretty dark scenarios pretty quickly.
Mark ZandiAn overheating economy, characterized by accelerating inflation and rising interest rates, is another precondition for recession. This doesn't describe today's economy.
Mark ZandiIt has become fashionable to rail against government intervention in the economy, and the FHA is a favorite example by those trying to show the government's overreach. In reality, the FHA shows how government action during the Great Recession forestalled a much worse economic fate.
Mark ZandiToo-easy credit and millions of bad loans made during the U.S. housing bubble paved the way for the financial calamity and Great Recession that followed. Today, by contrast, credit is too tight. Mortgage loans are particularly hard to get, creating a problem for the housing market and the broader economy.
Mark Zandi