It's easy to blame the whole thing on the Federal Government but it's just not the case. During the real estate boom, banks got in trouble for issuing mortgages to borrowers who they knew would default - so they could take over the properties and sell them for a profit.

The guy down the all from me who issues mortgages isn't scrambling to meet his quota because the Federal Government is on his case. He's processing these mortgages TO MAKE MORE MONEY FOR THE BANK! Some banks bent the rules so far that the federal government would not approve. They bent the rules so they could MAKE MORE MONEY! They were making more money on Jumbo Loans or a sub-prime/deferred interest loan. The banks got burned practicing business this way and they should pay the price. If they pay the ultimate price, banks aren't likely to practice business this way again.