The Subprime Crime

The Great Recession, the name given to global financial meltdown was the worst financial crisis since the Great Depression. The wealth destroyed by the recession sits at $14 trillion. The subprime loan fiasco was the epicenter of the Great Recession. The debacle began to unfold in December of 2007 when the housing market began to implode under the weight of the subprime mortgages. Mortgage delinquencies and forecloses piled up creating an avalanche of securitized subprime mortgages. The financial instruments derived from these subprime mortgages crumbled setting the stage for the Great Recession. While there is plenty blame to go around, one group deserves special attention. Washington’s social engineers crafted unrealistic homeownership expectations that culminated in the largest housing bubble in history. The outcome of decades of government intrusion into the housing market was catastrophic.