The govt created freedie mac and fannie mae to guarantee bad loans. They are quasi govt agencies. They were a horrible idea and they got out of control decades ago.

Mr. Bush and the republicans passed the Aemrican dream act which enabled poor people to buy homes they could not afford with the feds paying downpayments and closing costs.

Without govt interference, most of the bad loans would have never been made. The banks would never take such risks. But with the fed laws, they banks made bad loans, bundled them and sold them.

Greed certainly played a role, but govt interference is the primary cause of the problem. Liberals in both parties think that the government is the answer. There should have been no bail out. Freddy and Fannie need to be dissolved and most of the fed laws encouraging bad loans repealed.