The "boring" financial crisis

This week the federal government bailed out some financial institutions. First it started with Fannie Mae and Freddie Mac, which where already tied in with the government so no big deal, other than the complete lack of leadership and control exhibited by those companies. Lehman Brothers then went bankrupt, but the gov't didn't do anything then AIG went down and the gov't stepped in and bailed 'em out with tax payer money. So where did the problem start. I think if you back to 9/11, we lost 210 floors of business and over 3,000 hard working intelligent people directly tied to financial institutions. This wasn't the problem though the answer to the attack was the problem. Right after the attack the fed lowered the interest rate. Seems like a harmless move, but then President Bush wanted to make the attack on terrorism more personal so to speak. And what says freedom like owning your own house. So while the gov't made a move to make it easier to get a house. Well actually they made it easier to get your hands on money that you could use to buy a house. Banks started handing out money with little to no down payments now, (this is how the Helfen's came into home ownership with a 80/15/5 piggyback loan done avoid PMI). But I think the rush to get people into houses without having to have down payments and good credit actually lead to more problems than solutions. Before people wouldn't even think of getting a house without 20% to put down and banks wouldn't even consider a loan. I have heard many talk about waiting 10 years or long to scratch and save enough to get a house and now that was wiped out. It actually happened before 9/11, because we got our house in August, but I think the flood gates really opened after that and people where willing to take on massive amounts of debt in order to live in the 'now'. Unfortunately, 'now' is over and people are paying tomorrow prices for stuff they got yesterday (that may not make any sense, but it sure is fun to say). Anyway when the gates where opened the restrictions were lowered and all kinds of people could now get homes. Even people that had bad credit and unstable jobs. Good for them, bad for the banks. There is a reason some people are called 'high risk' and with the low interest rates even when the banks tacked on a extra percent or two it was still worth the risk. The problem is when the defaulted instead of default on 80% or less of the house now, they were defaulting on 95%, which is essentially an extra 15% the banks had to eat. I believe there was a lot of corruption on wall street and now the risk is being assumed by the tax payers which isn't really right, but I think we have back ourselves into such a corner that it has to be done. It really isn't fair when someone plays by the rules and tries to take care of their bills and then has to bail out people that have no business being allowed to get their hands on that much credit. The thing to do now is kind of roll back the legislation or rules that made it super easy to get housing credit, 20% down no exceptions, unless you've already owned a home or something, and keep the interest up. 1980 inflation is coming.... Also I think the crisis is closer to the collapse of 1987 or the economics of the late 70's. I don't think it is like the great depression the unemployment was in the 30% range and we are around 6%, plus wall street rebounded this week. So the dynamic are different here. Whoever inherits the white house likely will get a recession, funny how that happens ever 8 years.