A manufactured crisis

Had some of these individuals attempted to get a mortgage in say, 1993, they would have been turned down flat. The difference is that Bill Clinton became President of the United States in January of 1993 and upon taking office wondered out loud why so many poor people and visible minorities didn’t own their home and what could be done to change this situation.

Naturally, the good people at Treasury and Justice didn’t want to disappoint the new president, so they put the word out to financial institutions that the U.S. Government would really like to see more low income and visible minorities achieve the American Dream of homeownership. That many individuals among these visible minorities were financially unqualified didn’t appear to matter either to the government of the day or to the bankers who advanced the cash. [they didn't advance cash: the sold the mortgage to Fannie - and the taxpayer assumed the (normally prohibitively high) risk.]

The second part of the crisis is due to good old American ingenuity, as those bankers who were urged by their government to lend money to anyone and everyone saw an opportunity to take these so-called sub-prime loans and package them into investment vehicles...

[as I said, more than one domino - but the one that started it all?]

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[btw:] "The current “correction” that both the real estate and the financial markets are undergoing will be relatively short lived, as the basic U.S. economy is sound. It’s not like Americans have lost their capacity to produce."