I think you will agree the government certainly didn’t help things at all. In fact, they failed on many levels reigning in these investment banks and financial institutions. They fought tooth and nail due to lobbying to restrict leveraging by these institutions. But I totally agree with you that you can’t only blame the government.
Too many people want to blame it all on the US government but that is simply too convenient and not correct. Collectively as a group too many people were in denial at what went in. Even many bears enjoyed watching their fake net worth via home prices go up. Very few people that I know totally cashed out of all their real estate during the bubble.
No way anyone can blame all of this on the government. Just look at the numbers in 2006. 85% of subprime loans came from the private side.
In 2004 in San Diego a whopping 80% of all mortgages were adjustable rate mortgages and 47% were interest only!
