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Although there were numerous bad actors during the bubble days of housing in mid decade, not all banks and lenders did bad things. Mainly it was brokers in places like southern California, Vegas, Florida and Phoenix who were pushed to just generate volume and not worry about quality. Getting paid for generating numbers of mortgages instead of quality mortgages led to much of the problems we face today. Young Wall St bankers, who actually convinced themselves that house prices in the US never go down, and who got big bonuses for generating more and bigger securitized pools of garbage, just added the fuel. When that was combined with Barney Frank refusing to rein in Fannie and Freddie, and covering up for the illegal actions of Franklin Raines and his cohorts, and the political push for making subprime loans and increasing home ownership under CRA rules, then disaster was a guaranteed outcome. Despite what the media and various politicians like to rant about, most of those people lost their jobs and lifestyle, and are doing something different today. Raines, of course, got his bonus and went on untouched. What occurred at the banks and Wall St was not criminal for the most part, just stupidity pushed along by reverse incentives against doing things right. In short the whole system was set to fail and Barney Frank was the one most responsible for the debacle.

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