As regular readers of this blog surely know, I published a book early in 2012, Gambling with Borrowed Chips. I'm thinking of that book anew because one of its key contentions received some support in recent days from an unlikely source, Janet Yellen, the new chair of the Federal Reserve. One of my book's central contentions was that overly the permissive credit policy by the Federal Reserve throughout the early years of the new century under both Greenspan and Bernanke fueled the housing and housing derivatives boom, a boom that was bound to burst. Entering the new century, the Fed Funds rate was at 6.5 percent. Greenspan pressed to lower the target in several steps starting in January, so that in early September, before the 9/11 attacks, the rate was 3.5 percent. Of course, after those attacks the Fed sought to forestall panic by lowering the rate further, to 1.25. If you only have a hammer (or only think you have a hammer) all problems look like nails. ...