[durasell]

I don't think that it's a matter of assigning blame. It's a complex system. Bubbles don't form overnight and they are not the creation of one or two or even a hundred different professions.

My point, such as it was, is that banks are about to take a financial beating. This may or may not lead to more consolidation or the tax payer picking up the tab, S&L style.

What is happening is very dangerous...

[Dark Skies]

Banks sell their mortgage portfolios. And each portfolio has balance (spread over areas and time) and has a big equity cushion of 20-40%. Hard for the actually owner of mortgage pools to take much of a beating with those numbers. And the owners are for the most part institutional investors who have been buying mortgages and other securities for a while and keep their portfolios balanced (i.e. they take some risk and they sit on some staid securities).

The system is complex...but it works. There isn't much of a bubble yet.