You keep speaking on the premise that it is contained to sub-prime mortgages. "The people who took out those loans knew what they were getting into" What about

You keep speaking on the premise that it is contained to sub-prime mortgages. "The people who took out those loans knew what they were getting into" What about the other 90% of people who live on the same street as the asshole with the sub prime mortgage who are now unable to sell their house if they need to because the sub prime one is at auction for half the price they need to get? Liquidity isn't going to fix that, we have a problem with too many houses on the market and too few people buying them. If you have enough money you can still get a prime mortgage, people just don't want to buy right now.