Rhymes with Cars & Girls | He’s a savvy one, he isLet me offer a trivial re-phrasing of the effect than The Bernank is so proud of: QE made it harder for people to save up for down payments. Hooray! Oh, wait. Never mind.
Bernanke: QE successfully brings down mortgage rates
[...] So yes, it’s not surprising if QE ‘brings down mortgage rates’ anymore than it would be surprising if the Fed bought up tulips and then the price of tulips went up. The real question is, why should we want that.
Do we now think mortgages have been generally too hard to get in the past 10 years? Is that the Lesson Of The Crisis?
I suppose if you're thick enough to think the problem in the last ten years was "mortgages are too hard to get" then you're also thick enough to think that the problem also included "downpayments were too high."
I have been upset since literally the age of eight when people cheer every time some Grand Vizier brags about keeping interest rates low for mortgage borrowers. It always make me want to slap them and demand to know why they think borrowers deserve to win out over savers.
(Of course I know exactly why: there are more voters who want to spend Other People's Money on houses right now then there are voters who want to defer consumption until the future.)