News Briefs

Martin Lowy argues in a Financial Times op-ed that the true cause of the U.S. housing bubble leading up to the Great Recession was a massive inflow of foreign money into the U.S. Lowy contends that if substantial amounts of foreign capital had not been invested in mortgage-backed securities between 2004 and 2006, private U.S. lenders would not have been able to extend mortgages to unqualified borrowers. FT
 
The Wall Street Journal reports that the connection between economic growth and tax cuts is not as clear-cut as many experts believe. The author argues that previous tax cuts have had mixed results on economic growth, and it is unclear what effect the newly proposed tax cuts will have on the macro-economy. WSJ