In addition, Democrats like Warren Buffett also warned of this fiasco brewing, calling mortgage-linked derivatives weapons of financial mass destruction.

We have seen the tapes of Democrats saying that there were no serious problems at Fanny, clean as the wind driven snow, etc. etc.

The reform went nowhere. I haven't yet determined all who are to blame for that. For sure there are Democrats who have been given generous donations from Fanny/Freddie who were steadfastly opposed to stronger regulation. I don't doubt there are a few Republican blocking it too, but AFAIK Republicans called most often for reform.

The point is, both Republicans and Democrats were warned of these problems in many ways from many sources, and they did nothing. This is a bipartisan failure, though I think Michael Reagan is not far from wrong when he says Democrats robbed the bank, and Republicans drove the getaway car.

Aren't you Democrats ashamed at what you've let those in your party do in your name? I un-registered as a Republican several years ago, because I will not put my name to their sins. But in this case we must see plainly that Democrats who are trying to “fix” this problem — they run the show in Congress now — were a big part of letting it happen. They've had nearly two years to address this advancing crisis. But they seem to have absolutely no ability to hold themselves accountable. Corruption is corruption, I don't care which side of the aisle you're on. And the same goes for neglect and stupidity.

In addition, Democrats like Warren Buffett also warned of this fiasco brewing, calling mortgage-linked derivatives weapons of financial mass destruction.

We have seen the tapes of Democrats saying that there were no serious problems at Fanny, clean as the wind driven snow, etc. etc.

The reform went nowhere. I haven't yet determined all who are to blame for that. For sure there are Democrats who have been given generous donations from Fanny/Freddie who were steadfastly opposed to stronger regulation. I don't doubt there are a few Republican blocking it too, but AFAIK Republicans called most often for reform.

The point is, both Republicans and Democrats were warned of these problems in many ways from many sources, and they did nothing. This is a bipartisan failure, though I think Michael Reagan is not far from wrong when he says Democrats robbed the bank, and Republicans drove the getaway car.

Aren't you Democrats ashamed at what you've let those in your party do in your name? I un-registered as a Republican several years ago, because I will not put my name to their sins. But in this case we must see plainly that Democrats who are trying to “fix” this problem — they run the show in Congress now — were a big part of letting it happen. They've had nearly two years to address this advancing crisis. But they seem to have absolutely no ability to hold themselves accountable. Corruption is corruption, I don't care which side of the aisle you're on. And the same goes for neglect and stupidity.

That's all just astounding. Have fun clinging (yes, clinging) to your delusions while the nation melts.

And by the way, your reading of overseas economies is just as delusional. Europe is a dense web of regulations designed to even out the economies of the wealthier and poorer nations. Your trumpeting of the end of “managed economies” in Eastern Europe is misguided–they've just traded a set of totalitarian restraints for an all-for-one-and-one-for-all European model that you would probably see as an unacceptable sacrifice of sovereignty.

And the free markets are expanding in China and elsewhere in Asia because they're flush with our cash. They're also not afraid to invest our cash in infrastructure building and myriad other government-funded projects that you'd probably call “pork.”

And singling out ACORN as a target of our economic woes is just as foolish. ACORN has done a lot of wonderful, tough work to raise the standard of living for workers — particularly workers in the service industry, which is where all of us are going to be eventually. Will you still be singing the praises of a “non-managed economy” when you're wearing a paper hat? I wonder.

Instead of looking at the root cause of why particular groups aren't earning as much money or progressing, they lower the bar for mortgages. A quick fix that creates more and greater problems. The person is still poor, chances are they'll be unable to keep up payments, but the politician earns their undying loyalty (and their vote).

It's a great way to pat yourself on the back for 'helping the poor' and get votes, but it isn't a solution. For the poor especially. It's the old give them a fish instead of teaching them 'to fish' because its easier and I can still tell myself what a great, generous person I am for giving it to them.

Homeownership should be encouraged, but not at the expense of the economy. Both the lenders and groups like ACORN, which is where one of the Obama connections comes in, do deserve blame. But – banks and lenders could not operate without doing as ACORN wanted them to. ACORN held over them the very real threat of political pressure and lawsuits and it worked wonders.

My opinion is that mortgage approval should be colorblind – a person should have a certain credit rating and/or income to qualify for a certain level of loan. Race shouldn't enter into it at all. Just financials.

Then when the crisis happens, I walk away from the mess. I'm sure there were some Republicans involved as well. However, the Democrats have benefited most from Fannie/Freddie political dollars.

Also, there has been a movement for some time in Congress to fix Fannie Mae/Freddie Mac. This was blocked in the Senate as discussed in an earlier post. Senator Dodd and Rep. Barney Frank are documented as repeatedly putting down any suggestion that the 2 institutions were having problems.

Europe is moving toward lower taxes and has an open market throughout the entire European Union. Eastern Europe has dispensed with most, if not all, of its former managed economies.

In a more recent, and more surprising instance, Europe and Britain, as I understand it, are not moving to bail out the banks and institutions. They are taking a free market stance by allowing them to fail, rather than bailing them out. And if you want more examples, just move your glance eastward to Asia and especially China. The free market expands there while contracting here. Go figure.

Blaming Wall Street's problems on “bad credit, low income” people (and the “people like Obama” who wanted to help them own houses–a list that would also include Reagan, and George Bush with his “ownership society”) is the type of conservative screw-the-poor immorality that might win you an election, but will cost you your soul.

The vast majority of folks who are getting foreclosed on are solidly middle class people who took out cheap-sounding loans to buy houses whose value had been inflated by a real-estate bubble. Here in the suburbs of California and in suburban Ohio and Florida, which are the Ground Zeroes of the foreclosure crisis, there is no housing that one of your “low income” villains could afford even with a subprime loan. Those mortgages went to middle-income people who wanted to buy in their own communities or near their workplaces, but who saw home prices escalating beyond their means.

That doesn't leave them blameless–their irresponsibility deserves a decent share of the blame for all this, while Steve's keeping-up-with-the-jonesers deserve part of it as well for taking advantage of low interest rates to trade up, refinance multiple times, etc. However, to argue at once that there was too MUCH regulation, and that the banks' own irresponsibility should be deflected onto government and “community organizers” for encouraging people to own their own homes, is completely farcical and turns the real source of the government's mismanagement completely on its head.

The government's (under both parties) well-meaning efforts to encourage home ownership should have been balanced by a thoughtful and rigorously implemented regime of, yes, regulations to ensure that lenders, investment banks and the rest of the financial-services industry didn't spiral out of control with their manipulation of mortgages and other securities. Instead, the repeal of the Glass-Steagall Act (which Bill Clinton signed into law, to his detriment), the Fed's desperation to keep at least one element of the economy afloat during the early aughts, and the Bush administration's eight-year coffee break on enforcing regulations left the industry with no grounding to keep it from creating the current mess.

I'd like to see your evidence of “Europe moving away from regulation,” but I would guess that whatever evidence you had a few weeks or months ago, you can pretty much forget it after the events of the last couple weeks. You can forget it here, too–starting with this bailout, which I would guess is still gonna happen by the weekend.

Everyone forgets that the relentless greed of the American consumer, and the need to have everything, and have the best (and a bigger and better model next year) is also a huge factor that contributed to this mess.

Ask yourself reader – how many different cellphones have you had in the past 8 years? Did they all break, or did you just want a better one?

I rest my case…..

Also, laying blame at left-ish politicians who want to help more people purchase homes is disingenuous. If I recall, Newt Gingrich and his ilk were pushing the government to change the rules to allow more and more people (and yes, including people in government housing) to purchase homes, too.

But you nailed it with greed. The real estate/banking/credit industry are more culpable in running this into the ground than a specific law governing credit. The whole game of mortgage-backed securities, for example, was just jaw-dropping in terms of risk assessment. If housing prices continued to go up (where there was pressure in the industry to do so through appraisals that pushed market prices upward, even though a piece of property wasn't worth the amount stated), then these securities could be profitable.

Were “ordinary folks” guilty of being greedy, too? Absolutely. If you saw your house appreciate in value at the rate it did during the housing hey day, wouldn't you look for ways to increase your wealth (i.e., buying multiple properties by tapping equity in your artificially inflated home price)? If a banker/loan officer/financial consultant (all of whom stood to make a commission off of your increased debt) showed you how you could do all this and found the right loan product that enabled you to do so, wouldn't you think it was a good investment move when so many other folks where doing the same thing, and seemingly making money with second properties as rentals or housing flipping? What about people who rely on professionals to guide them through the real estate process, but said professionals don't really have your interests at heart? Who's to blame then? I could go on and on till I'm frothing at the mouth and falling over backwards, but I think you get the idea.

“Free markets still beats socialism…” Yeah, too bad Bush & Co. doesn't listen to such talk 'cause the Paulson plan was good old fashion socialism … but only for the wealthy.