ANSWERS: 2
  • I found this question because I was going to ask "How could the people that we have intrusted to govern the USA not forsee the economic crisis that we are facing?" Here it is a year after you asked this question and look where we are. I don't have the answer but perhaps others can answer your question a well as mine.
  • the Government caused it. Under the Clinton Administration (I am not blaming Clinton, just pointing out so it doesn't sound like I am blaming Bush for something he wasn't responsible for) the lending laws were revised at an attempt to get more people to purchase homes. So too many people bought homes that they could not afford. I am not just talking about low income families that got into a small, resonable priced housed, but often middle class families that bought houses much bigger than they need. I worked in the morgage industry back in 2003 and I predicted the rash of forcloseures, but I had no idea that it would cause the collapse of the banks holding these morgages, afterall, they own the loan, and if the loan is unpaid, they own the property, so they should have the same value. The problem is that the banks over inflated their assests in order to sell their stock.

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