They really hate Vaclav Klaus, don't they? (4)

Here's part two of that letter
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Equally dubious and illogical is [Vaclav Klaus'] conclusion that the current economic crisis was an “unavoidable consequence” of immodest and over-confident politicians “playing” the market. The roots of the current economic crisis lie in the collapse of the US sub-prime housing market and the subsequent fall-out of structured investment products created from these underlying housing loans. If anything, it was the lack of regulation and investor understanding of these complex structures that is the key to the crisis. His failure even to grasp the roots of the crisis is downright Palinesque; and his cure, which is to “repeal various labour, environmental, social, health, and other standards” is completely batty.

President Klaus displays the defining attitude that got us into this mess in the first place. His seemingly unquestionable faith in the markets to take care of themselves, with sweeping claims such as “we always need more of markets and less of government intervention”, just does not make sense, when it was the market’s failure to curb excessive leverage and speculation that led to the current financial crisis. We need more than just sound bites, Mr Klaus.

Calvin Quek, Singapore.
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VK has nailed this one as well; in the Anglosphere and Spain, politicians knew that rising house prices give an illusion of ever rising wealth so did their best to make sure they happened, so VK is quite right to say that "Their attempts to blame the market, instead of blaming themselves, are unacceptable and should be resolutely rejected."

It is relatively easy to stoke a house-price bubble - all you need is gradually falling interest rates, very restricted supply* and a complete lack of sensible banking supervision** - job done. The letter writer appears to have fallen for the Nulab line that we should blame the Yanks and the banks.*

What a twat, franky.

* The restricted supply is the opposite of free markets, isn't it? But UK parties always promise to restrict supply (all of their manifestos include some waffle about 'protecting the Greenbelt', AFAIAA) to gain the votes of the NIMBYs, which is the vast majority of voters.

** I accept that there was "lack of investor understanding of these complex products", but the overall picture was pretty clear. Total consumer debt doubled in ten years and house prices trebled, did that not set alarm bells ringing?