Phil Graham was indeed involved in it. This legislation was very bipartisan in nature with major input from Greenspan and Rubin.
Yep. No one's hands are clean in this mess. I'm all for deregulation - to an extent. It seems that the banking industry was a whole lot more stable - perhaps less sexy, but more stable - when there were more regional banks, and less of these Goliath mega banks.
Also, mortgages really became a mess when they were allowed to be securitized. Before, mortgages were locally originated and locally serviced. If a borrower got into trouble, they had a better chance of going through loan workout, as opposed to instantaneous foreclosure. Sure, there were fewer loans made, but banks made sure that the borrowers were lower risk because the bank held onto the paper for a much longer period of time.