Exactly. Trillions of bogus triple A rated paper created by Wall Street and the rating agencies, who get paid fees to rate the bonds. That was the money factory.
Then, add in the tremendous greed of the real estate brokers, appraisers, mortgage brokers, etc. all ready and willing to cut corners and make loans from the money the factory created.
Add in the greed of the flip this house crowd, who thought real estate would forever go up, and many took unaffordable mortgages.
Now, banks and large brokerages around the world have trillions of assets on their books, and no one can value them. So, you have a credit crisis and firms stop lending to one another.
Greed, and hubris.
In the late 90’s my cat Sammy Davis Junior received a credit card offer in the mail with a pretty good line of credit. Davis Jr declined.
Greed is Good.
The problem here is that our government and its fake banks (The Fed, Fannie, Freddie) created this mess. When people “flip” houses they buy them, fix them up, and sell them at a higher price. They are providing a great service.
What does the government do? It encourages you to borrow MORE from the banks by letting you write off the interest.
The fake banks provide the credit that the other banks then pass off to the borrowers. All of this stinks not of greed but of unmitigated socialism. McBama want more regulation. But the answer is to go back to the free market and stop “helping” people buy houses.
Watch Wall Street. Great movie...and America is still a malfunctioning corporation in need of restructuring.
Buy Gold.