“The real estate crash was caused by people borrowing money they couldn’t afford to pay back when times got hard. Banks were ordered to lend the money to high risk borrowers or face discrimination lawsuits.”
That’s the core of the problem and that is on our government. Fannie, Freddie, FHA, Congress.
The thing that took that core problem and made it explosive was the bundling of the crappy mortgages into derivatives, taking bad loans and leveraging the heck out of them. That’s probably on Goldman et al.
We're not supposed to point that out. And no "probably" about it.
I don’t know that they “leveraged” bad loans as much as sold them. That’s normally what you do with bad paper. It’s not evil.
Borrowers came to the banks, not the other way around.
If you get a loan for a car and then decide you don’t want to pay it anymore, that’s not the bank’s fault.