Wallison also presciently warned of the possible dangers [of government subsidization of risky mortgages for people who were unlikely to be able to pay them back if real estate prices fell] back in 2005.What's interesting is that I recently read something similarly[1] prescient:
Government-guaranteed home mortgages, especially when a negligible down payment or no down payment whatever is required, inevitably mean more bad loans than otherwise. They force the general taxpayer to subsidize the bad risks and to defray the losses. They encourage people to "buy" houses that they cannot really afford.The quote is from Economics in One Lesson, by Henry Hazlitt, originally published in 1946.
[1] Note that I'm not saying that they say or address exactly the same thing, just that they're both prescient.
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