John LegendVerified account

These options really did make homebuying more accessible; people could afford homes they couldn't have otherwise. 7/x

Now, it all came to ruin because it turned out the *risk* was being systematically mispriced throughout the whole system. 8/x

One lesson: consumers have a hard time (understandably!) pricing risk themselves. It's *very* easy to con them with teaser rates etc 9/x

Which brings us to the current GOP vision for the individual market in the House/Sen bills. They're advocating for subprime insurance 10/x

The arguments are v similar: current regulatory structure locks people out, raises prices and limits consumer choice. 11/x

The solution is to deregulat and allow the health insurance version of "interest only loans" and NINJA loans to proliferate. 12/x

And some people will be able to better "afford" insurance in the same way an interest-only loan lets you "afford" a big house 13/x

But the problem is the risk is still there! We've learned that individual consumers aren't great at pricing risk. 14/x