OK, not to get into politics, but are you even paying attention to what's going on now in the markets? It was a LACK of regulation and meaningful oversight that led to the morgtage and credit meltdown. I'm a free market believer, but unregulated capitalism leads to abuse. There has to be a balance, enough regulation to protect the consumers, the taxpayers, and the basic system, but not so much as to choke business and innovation.
It was the government prodding the banks to make more mortgage loans by cutting the interest rate that caused this crisis!
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Today's financial crisis has its immediate roots in 2001, amid the end of the Internet boom and the shock of the September 11 terrorist attacks. It was at that point that the Fed turned on the monetary spigots to try to combat an economic slowdown. The Fed pumped money into the US economy and slashed its main interest rate - the Federal Funds rate - from 3.5% in August 2001 to a mere 1% by mid-2003. The Fed held this rate too low for too long.
Monetary expansion generally makes it easier to borrow, and lowers the costs of doing so, throughout the economy. It also tends to weaken the currency and increase inflation. All of this began to happen in the US.
What was distinctive this time was that the new borrowing was concentrated in housing. It is generally true that lower interest rates spur home buying, but this time, as is now well known, commercial and investment banks created new financial mechanisms to expand housing credit to borrowers with little creditworthiness. The Fed declined to regulate these dubious practices. Virtually anyone could borrow to buy a house, with little or even no down payment, and with interest charges pushed years into the future. ...
With the housing collapse lowering spending, the Fed, in an effort to ward off recession and help banks with fragile balance sheets, has been cutting interest rates since the fall of 2007. But this time, credit expansion is not flowing into housing construction, but rather into commodity speculation and foreign currency.
The Fed's easy money policy is now stoking US inflation rather than a recovery. ... Yet the Fed, in its desperation to avoid a US recession, keeps pouring more money into the system, intensifying the inflationary pressures."
One case exemplifies the power of free market capitalism: Hong Kong. They have very little regulation and very POOR customer and product services but yet they continue to prosper to become as one of the richest areas of the world.
