Prior to the financial crisis in 2008, the Federal Reserve Board reduced the Federal Funds rate to just above 0% and the gov't took an active role in the mortgage market, eg. Fannie/Freddie. Fast forward to today and the Federal Reserve has the Fed Funds rate at 0.25% and the Obama administration is coming out with more gov't intrusion into the mortgage market with plans for gov't sponsored loan mods and refi's.
The first situation resulted in a real estate bubble and the actions by the Fed and Gov't today will most likely produce the same, in due time. - Sun Feb 12, 2012