Why We Should Let Housing Prices Keep Falling

There is a superficial attractiveness to policies that seem to promise an end to falling housing prices, but...these policies all have the common feature of getting the government further entrenched in the operation of the housing market, and this creates all sorts of long-term market problems. I would have thought that recent events at Fannie Mae and Freddie Mac, for example, would have made Americans recognize the costs of having government-sponsored enterprises play mortgage lender to the nation. I would have hoped that the history of public housing would have made us wary about spending huge amounts of tax dollars to get into the business of public property management.

But we won't let them keep falling, I bet.