Treasury Secretary Timothy Geithner said the mistakes made were avoidable. This is a sentiment expressed by many in the housing market since the collapse.
Click Here "We allowed an enormous amount of the mortgage market to shift to where there was little regulation and oversight," Geithner said.
He continued, "We allowed underwriting standards to erode and left consumers vulnerable to predatory practices. We allowed the market to increasingly rely on a securitization chain that lacked transparency and accountability. And we allowed the financial system as a whole to take on too much risk and leverage."
The proposed government reform released two weeks ago outlined methods to reduce government participation in the housing market, and proposed to wind down Fannie and Freddie completely.
"Our proposal for reform breaks sharply from the past to fundamentally transform the role of government in the housing market," Geithner said.
This fundamental change is based on a shift of what many believe is the "American Dream." According to Geithner, "our goal is not for every American to become a homeowner."
