That everyone was trying to make a buck off the inflation in the housing market by mid-decade is the no brainer.
When an idiot's banker tells them that they can refi in order to avoid foreclosure indefinitely, the idiot will believe them. That's called predatory lending, though, and it was rampant.
Government started the whole sub-prime mess. They created the beast.
One of the main reasons that the values were inflating was because the lenders were getting their appraisers to "make the value work" so that the loan would be workable. (Can't get a cash out refi if there is no 'equity'. Often times, there was never any equity to begin with, especially in cases like the 115% LTV loans)
Last edited by Tucker Case; 10-24-11 at 12:05 PM.
Is it just me, or is the fact that our financial system is so convoluted that no one is even completely sure what happened, part of the problem?
The Makeout Hobo is real, and does indeed travel around the country in his van and make out with ladies... If you meet the Makeout Hobo, it is customary to greet him with a shot of whiskey and a high five (if you are a dude) or passionate makeouts (if you are a lady).
Other: record-high oil prices.
"A witty saying proves nothing." Voltaire