Former WaMu CEO sees a housing bubble forming because the Fed is ‘hooked’ on low interest rates

[libertybele]

This is the first that I've heard speculation about the recent up tick in homes sales being a housing bubble.

Former WaMu CEO sees a housing bubble forming because the Fed is ‘hooked’ on low interest rates

Like many other banks, Washington Mutual rode the wave of low-interest rates to grow its mortgage business during the housing boom of the early 2000s. During Kerry Killinger’s time as CEO, WaMu grew to have more than $300 billion in assets.

But when the subprime bubble burst, the bank’s fortunes quickly turned. In September 2008, at the height of the financial crisis, Killinger was forced out by the company’s board, and ultimately the bank was seized by federal regulators. It still stands as the largest bank failure in U.S. history.

In their new book, “Nothing Is Too Big to Fail: How the Last Financial Crisis Informs Today,” Kerry Killinger and his wife Linda, who previously served as the vice chair of the Federal Home Loan Bank of Des Moines, explore WaMu’s failure, the government’s response to the last crisis and where there is growing risk in today’s economy.

https://www.marketwatch.com/story/the-former-ceo-of-washington-mutual-foresees-another-housing-bubble-and-he-blames-the-fed-11621287287?mod=home-page

[Hoodat]

Washington Mutual's push for diversity at the expense of competence is what doomed that bank.  Killinger is just one of many who got paid huge bonuses while lives were being destroyed, and then suffered zero consequence for his bank's failure.