There is a lack of consensus as to how the relaxation of credit standards will impact safety and soundness. To date, loan delinquencies have remained modest, both within and outside of the banking industry. However, the undiminished appetite, particularly for the nonconforming mortgage product, has allowed for the flexibility to continue. And there is no slowing in sight, despite all the warnings that we have heard and indications in some markets that there has been a leveling, and even a decline, in some property values …
From Alan Greenspan’s housing bubble coffee break
The sad part about this is that it will be used to attack the Fed system, and not the Let the Market regulate itself philosophy of Mr. Greenspan.
