By Arnold Kling
I’ll get to current events in a moment. First, Bob Shiller writes,
Consider investors in Fannie and Freddie bonds. While the US government never officially promised to bail them out, it did create a special agency, the Office of Federal Housing Enterprise Oversight, which was to assess their strength in an annual report. But this agency never even acknowledged that there was a housing bubble. Government leaders gave no warnings. So can we really say that investors must suffer the full consequences of any losses? How can this be fair?
Thanks to Mark Thoma for the pointer.