2. If none, what channel or mechanism is perpetuating something that everybody knows is a bad deal? This. As I said in another reply to my OP, the government i

2. If none, what channel or mechanism is perpetuating something that everybody knows is a bad deal? This. As I said in another reply to my OP, the government is backing these loans, which makes everyone think they're golden - and that might be true. Perhaps the government will allow the bubble to inflate forever, but the government stepped in in 2008, and there were still plenty of short opportunities available. But it's unquestionably a bubble if hundreds of billions of dollars (and rising) of loans are being made to people to buy something that A) has no collateral (making it worse than the subprime crisis) and B) the value of the service they're purchasing is, by all perceptions, dropping over time.