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That may be a piece or the seed of it, but no govt forced the lenders to generate fraudulent loans at scale or to then repackage those loans into securities and
by toss1 7y ago
That may be a piece or the seed of it, but no govt forced the lenders to generate fraudulent loans at scale or to then repackage those loans into securities and massively mis-rate the risk of those securities -- both of those activities done at massive scale (along with CDOs and other shenanigans) is what collapsed the banking system.
- Gibbon1 7y agoA lot of it was break down of originating standards, rating fraud, and worthless insurance on as you said CDOs and other shenanigans. All the people responsible get protected and 10-20 million people lost their homes. Worse the employment to population ratio dropped 10% and has stayed there since.