Regulation and deregulation are catch-all words, which are generic and thus usually meaningless without specific context, so questioning each and every specific reason for one is appropriate, especially in historic perspective.
Deregulation questions usually start being raised when it's obvious that regulation has gone too far and either doesn't do what it was meant to do or actually does more harm than good.
Sources and independent analysis are very important. For instance, in the Capitalism Doesn't work editorial - while we can easily imagine former Ayn Rand's acolite Alan Greenspan talking like a puppet in his wife Andrea Mitchell's voice and with her hand up his arse, even he (she) couldn't possibly propound this nonsense : "In other words the dirty secret is out: capitalism doesn’t work. Capitalism is a 0 sum game where by the creation of currency out of the value of existing currency you eventually reach a state where it is impossible to create new currency because there is no further value to extract.
Capitalism is exactly opposite of Zero-sum game, and the words are not Greenspan's, they belong to author of the editorial, one Nicholas Ventimiglia who is likely as much of an economist as the other noted "economist" Howard Dean who recently famously declared The Debate Between Capitalism and Socialism Is Over.
Some analysts / researchers are better than others, and most of the time on the mark with their facts - even when I disagree with some of their analysis or thesis. Among many, I could recommend Randall Forsyth, Jim McTague, Thomas G. Donlan.
Here is the latest from Donlan Engines of Destruction (Fannie and Freddie) - B, 2009 December 21 "The CEOs of Fannie and Freddie made reckless bets that led to the downfall of their companies. Their actions could cost taxpayers hundreds of billions of dollars, but it is a myth to say they were the originators of the subprime crisis. Fundamentally, they were following the market, not leading it." Waxman exonerated the real culprit: "It is also a myth to blame the nation's affordable-housing goals. The bulk of Fannie and Freddie's credit losses are the result of their purchases of Alt-A loans and securities. Because many of these risky loans lack full documentation of income, they did not help the companies meet their affordable housing goals." (Alt-A usually means loans that are between prime and subprime.) Testimony and documents presented at the hearing that day would show that the two housing-finance corporations had worked hard to expand the mortgage market into a higher-risk zone -- and that many of the risky loans did help Fannie and Freddie meet their affordable-housing goals. ...... The new administration of President Barack Obama has been far more interested in bailing out borrowers and lenders than in placing blame where it belongs. It continues to rely on Fannie and Freddie to sustain the U.S. mortgage market, when it should be liquidating their portfolios and reducing the risk to taxpayers. ..... AS A HEARING OF THE HOUSE Oversight and Government Reform Committee opened a year ago to consider "The Role of Fannie Mae and Freddie Mac in the Financial Crisis," then-Chairman Henry Waxman, Democrat of California, rendered the verdict in advance of the testimony:
And here is the proof : Treasury removes ($400 billion) cap for Fannie and Freddie aid - FR / AP, 2009 December 25, by J.W. Elphinstone
So the Democrats are pointing the finger of blame on a "deregulation" legislature of more than 10 years ago having 3 Republican names on it, while exonerating the policy of "affordable housing to anyone" / CRA and others, where Fannie and Freddie and FHA were the main and willing parts of the Engine of Destruction. It's simple and, apparently, effective enough to confuse McCain and many others to want to reinstate S-G and, with that, rewrite the history and lessons of the real estate bubble and predictable consequent near-collapse of the US and world financial systems.
Another article, The Roots of the Crisis - B, 2009 December 08, by Jay Palmer - is a review of the book This Time Is Different by Carmen Reinhart and Kenneth Rogoff Reinhart and Rogoff make a compelling case that their "signals approach," grounded in a historical perspective, can deliver valuable information about whether an economy is "showing one or more of the classic symptoms that emerge before a severe financial illness develops." ..... Rapidly rising housing prices should have set off alarm bells, as well. Especially when the cumulative real-price increase in the United States over a decade was more than three times the 27% gain for the preceding 100 or so years -- and the total value of mortgages reached 90% of GDP. In This Time Is Different, Carmen Reinhart, a professor of economics at the University of Maryland, and Kenneth Rogoff, a professor of public policy and economics at Harvard, demonstrate that these worthies could have -- and should have -- known better. A tour de force of quantitative analysis covering financial crises affecting 66 countries over the past 800 years, the book identifies pre-crisis patterns that recur with eerie consistency. This Time Is Different is a must-read for anyone on the lookout for canaries in coal mines.
We know that the repeal of S-G had no effect on creation of housing bubble, the government policies (which are still continuing!) had, underwritten by the quasi-government institutions (GSEs) which could, in turn, dump all the risk and liabilities on the taxpayer... Waxman charade notwithstanding.
Thanks again. That makes much more sense.