"The Fed lowering interest rates to %1 or lower is what enabled the banks to offer these teaser products and floating mortgages (ARMS) at under %5. Without that, there is no feeding frenzy from the public. It might be politically expedient to blame the programs over at Freddie and Fannie, but they are a side show to this whole mess. If you want to talk about corruption at Fannie and the corrosive effects of stock option compensation, that's another story."

In point of fact the fed lowered the interest rate to stave off inflation, I believe. Now that coupled with the deregualtion would in fact confirm that the one two combination did indeed facilitate the destruction of Fanny Mae and Freddie Mac and the eventual destruction of others.

"As for government 'stimulus' I believe there is consensus among economists that it takes at least 2-3 quarters before it actually takes place. Which is why many of them wonder if it is worth it."

Which of course then begs the question of WHY it was SO critical to pass it IMMEDIATELY rather than to sit and discuss what would be in it. Boondoggle, I tell you.

"And the Cash for Clunkers program certainty was stimulative to the auto industry. Whether it will be worth it long term is another question entirely."

Well to the industries which are not American owned, I will grant you...but I didn't see a lot of stimulus for the American owned auto corporations. However, they are still awaiting their money from the government and have yet to get it, so we'll have to wait to see how stimulating it was for them.

you think I'm kidding that people were trying to warn about the impending crisis:

Shocking Video Unearthed Democrats in their own words Covering up the Fannie Mae, Freddie Mac Scam that caused our Economic Crisis

http://www.youtube.com/watch?v=_MGT_cSi7Rs&eurl=http://www.redstate.com/

"Your right and wrong. It all started with trickle up Reaganomics and deregulation in which the Democrats in Congress participated. Clinton continued it, and Bush made it worse with more his tax cuts. The American public participated with their greed."

Actually you're incorrect.

FIRST of all, it was call "trickle down" economics or Reaganomics...and it was built on the idea that if a rich person had more money, they could do only four things with it - spend it, save it, invest it, or give it away. The first three created jobs...period. The last one would help charities which could do the jobs rather than the federal government.

As for the deregulation of which you speak, it was actually created BEFORE Reagan, during the Carter years...but not to the extent it was at when Congress and Clinton got hold of it in the 1990s. Point is, it was almost completely deregualted during the 1990s and the banks were in fact encouraged to provide loans to those who were unlikely to be able to pay them back at that time. American dream and all that.

Bush actually tried to warn about a impending problem as did Greenspan. McCain actually tried to pass legislation to reregualte it in 2006 but it failed to pass Congress.

"Reasons for the financial collapse was the Fed and the various bits of financial deregulation. Not to mention a large section of the American populace going crazy. Lehman or Bear or AIG didn't implode due to Fannie Mae. They did that on their own!"

Well of COURSE they did! I SAID the deregulation triggered the event. And of COURSE the American people were scarred to DEATH! Fear of bankruns similar to the Depression started this...and I submit that the President has done nothing to stop the fear! Those with money and large corporations KNEW, once he was elected, that their taxes were going up...so what did they do? They STOPPED spending and investing and started hanging onto their money!

Why do you think the stimulus isn't working as well as everyone expected? No one has money because it's not trickling down from above...why? Because they aren't spending it.

Simple economics.

"If You'd Prefer To Secede (You Sound Awfully Unhappy)

You can move to Texas and vote for Perry in the goobernatorial primary. If you don't live in Texas already."

I'd rather fight (and consequently be a pain in the @ss for those jerks in DC) than switch, thanks! :-)

"Forget the republicans, get the Blue dongs on board. The American voters, voted for change."

Ah and here lies the rub - the Blue Dogs CAN'T vote for it if it's too liberal...because their constituents won't vote them back into office if they do! So they are caught between the DNC threatening to refuse to fund them for reelection and the people threatening not to nominate them for reelection.

I believe they will do what the people want, knowing the DNC will have no choice but to fund them if they win the nomination. What other choice would they have?

"Don't forget the almost finanacial downfall happened under a republican leadership, and the TARP money was given out before Obama became president. The Stimulus is working. The Huge deficit happened under BUSH, Obama inherited it."

Ah yes, that old chestnut. And WHAT, pray tell, was the predecessor to the economic decline? Why Fannie Mae and Freddie Mac of course. NOW, who tried to warn this Congress about it? Why Bush, Greenspan, and even McCain...but they were ignored and told everything was ok - see Barney Frank among others.

But that's irrelevant...as the deregulation which created this mess was started in a Republican Congress and a Democrat President in the late 1990s.

"And Whatever Was Spent On Stimulus and TARP Was spent here at least and not in Iraq."

Um...ok. Then explain to me the difference between wasting money supporting lousy corporations here and supporting corporations THERE?

The money is STILL wasted, either way!