Greenspan, the Fed, and the Housing Bubble

In a recent WSJ essay, Greespan denied responsibility for the housing bubble.

Fed Governor Donald Kohn viewed things a little differently.

"Long-term interest rates--the ones most relevant to the borrowing and spending decisions of households and firms--have been held down by easy monetary policy and the expectation that short-term rates will remain low for some time. And these low rates in turn have boosted the prices of houses and the value of corporate equity."

read the full paper