In relating Federal Reserve Board Chairman Ben S. Bernanke’s comments, Lawrence Kudlow ignores the real reasons why we have this recession (“Bernanke and golden rule,” Opinion, Tuesday).
Mr. Kudlow says that Mr. Bernanke claimed the Fed was not responsible for the easy money that created the housing bubble, and he blames the bankers. Why would he not introduce the fact that he ignored the real causes of the bubble? They include: incentives for and pressure by Congress on banks to give mortgages to the unqualified, authorizing the “Fannies” to buy bad loans and contaminate good loan packages with bad loans, and allowing American International Group Inc. and others to offer unregulated insurance on these contaminated loan packages.
If we are not honest about the real causes, we are doomed to suffer the same fate again.