Didn't those cheap loans, in part, account for the booming economy?
So did the dotcoms when people didn't invest in them wisely.
Again, I don't think any of this is Bush's fault. I think it's people not behaving responsibly. When you take out a 5 year ARM loan at 4.5% for as much house as you can possibly buy (even with the 4.5% interest rate) knowing full well that the interest rate WILL go up at the end of that 5 years, you're taking a huge risk. You're either betting you'll be able to refi at a decent rate or you're betting that you're going to be able to move to improve your situation at the end of that five years.
That's risky in Arkansas where the real estate prices have fluctuated modestly. That can create a very loud financial thud for people that did that in the states where the real estate prices have fluctuated wildly.
The cheap loans weren't bad. It's the cheap loans that turn into expensive loans that are the problem.