Wherever the free market has failed, you find the hand of government pushing it to the abyss. The housing bubble is just the latest example.
If Fannie, Freddie and the CRA hadn’t distorted the market, home values would not have risen the way they did. End of story.
The free market failed here due to fraud, lack of transparancy and non securitized lending. CRA started the mess but the lack of controls on leverage and the ability for companies to trade without adequate reserves was the real problem.