The Commercial-News, Danville, IL

Letters to the Editor

November 3, 2013

Government disguises its errors

Government disguises its errors

Editor:

Everyone should be aware that when government makes a mistake, its members will do everything possible to disguise that fact.

For instance, it is easily provable that the current recession is a result of government policy to promote home ownership, borrowers being encouraged by low down-payment, low floating-interest FHA loans financed through low Federal Reserve interest rates.

When the Fed raised these rates from 1 percent to 5 percent, mortgage defaults started, home values declined and new home construction fell from a high of 2.1 million annually in 2006 to 700,000 by September 2008. Little wonder many banks, which lost billions in home loan assets, needed the September 2008 bailout.

In early 2009, Alan Greenspan, then chairman of the Federal Reserve, testified that, “I was surprised banks held so many mortgages,” and, when asked why he had maintained a 1 percent Fed interest rate for so long his reply was, “Well, no one complained.”

Yet, after twists by those most responsible, including politicians Dodd and Frank, this all comes out as a “financial crisis” from “reckless” banking. Even today, government is fining JPMorgan $13 billion for “deceptively” selling mortgaged backed securities from 2005 to 2007 when even Greenspan did not suspect the impending disaster.

Want to buy a JPMorgan mortgage back security? The average pre-tax return since 2003 is a solid 5.2 percent despite the losses from the mortgage debacle. So why the fine?

Why? To continue the government disguise of truth. To believe otherwise is to live on another planet.

Ron Gore

Covington, Ind.

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