Video explains the financial collapse – moral hazard

The Center for Freedom and Prosperity charges ahead with another economics video to push back basic economic ignorance. The video describes what happened and how Congress, big-bank, and Fannie Mae and Freddie Mac combined forces to create a foreseen financial collapse.

This is not new information at all, but still a good video. Hat tip to Ed Morrissey at Hot Air for the pointer. The video is Featured on our site right now, and held here for posterity. Ed’s correctly notes the irony of CF&P calling this a basic economics video. This is Economics 101, why can’t the politicians figure this out?

From CF&P …

Executive Summary: This CF&P Foundation’s Economics 101 video discusses the Moral Hazard, which occurs when bad choices are subsidized. This often happens when government intervention lets people take risks while having little or no skin in the game. Housing policies, for instance, subsidized mortgages, thus enabling irresponsible borrowing and leading to bubbles and bailouts. Politicians may be setting the stage for the next crisis with a too big to fail policy that will subsidize the biggest financial institutions. (January 11, 2010) 3:38 minutes.


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Steve McGough

Steve's a part-time conservative blogger. Steve grew up in Connecticut and has lived in Washington, D.C. and the Bahamas. He resides in Connecticut, where he’s comfortable six months of the year.

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