> Banks were subsidized or required by the state to issue subprime mortgage loans to the poor; people with terrible credit who would have no chance of actually

> Banks were subsidized or required by the state to issue subprime mortgage loans to the poor; people with terrible credit who would have no chance of actually paying the loan back. How likely is this, really? These people wouldn't be poor if they could pull fast ones off of the best, brightest, and richest. In fact the intentional packaging of MBSs with bad paper, packaging directed by rich people who wanted to and actually did short the securities knowing full well they'd fail is what broke the system. Fed guarantees wouldn't have happened but for the the MBS' AAA ratings, and that problem persists, because the issuer pays the rating agencies for the ratings. It's called conflict of interest, it's rampant throughout the system.