The Republican Party's noise machine is getting down to a theme that it was the Democrats fault, and when it wasn't the Democrats it was poor people who took loans that they couldn't afford. Both fail. The Republicans have held the executive the last seven years and controlled Congress for eleven years prior to 2006; so if this mess was to be presciently cleaned up then they had the power.

Same with the poor minorities reading of the issue. ARMs became so pervasive that they were the common mortgage type for the white collar professionals too. I know of people in my industry [software] that have two ARM mortgages on the one house, and others who have ARM mortgages and cannot refinance because they are in negative equity.

There are many culprits for this; but the main one is the Greenspan policy of making money exceptionally cheap through money printing and ignoring inflation. It is no coincidence in m opinion that this all burst at the end of Greenspan's tenure. This means there is both Republican and Democrat culpability in keeping the good times rolling with cheap money. Greenspan's tenure goes across Administrations of both parties.

The issue is that Greenspan's central policy is unchanged under Benanke:

Credit creation is the Fed's signature crisis management policy: Let a bubble inflate, then watch it burst; clean up with lots of dollar bills.

We are seeing the culmination of a failed monetary policy that has been supported by both the American political parties. No President or Congressional leader has had the courage to oppose that policy.