March 1, 2011

Breaking Down the Mortgage Meltdown

Veronique de Rugy

George Gibbs Chair in Political Economy

To say that Fannie and Freddie had no role in the crisis ignores the hundreds of millions of dollars they bought of sub-prime mortgage securities, which fueled the whole crisis, says de Rugy. Additionally, de Rugy says that the small increase in homeownership we’ve seen since the 70’s was driven by unsustainable incentives.