” The crash was a result of bubble that was started back in 2002 and 2003. By 2007 it was little late to reform home loans as prices were at their peak of the bubble. How about 2006 when Rs had a clear majority?”
Correct. I warned FReepers repeatedly in 2006(plenty of time to bail if they had just listened)that RE was in a massive bubble, and it would be a TRILLION dollar bloodbath.
Maybe you can find them. I don’t know how to do it.
That was certainly a major part, but another key factor was that GWB's SEC, in April 2004, in effect let the Wall Street mega-investment houses self regulate. Theoretically, the 2004 agreement gave the SEC more power, but they had neither the resources nor the talent to do it (so many experienced regulators left the government to make bigger bucks on Wall Street). Bernie Madoff had been doing his thing since the days of Clinton, but I say it got a lot uglier after that 2004 SEC meeting.
You may say that investment houses should do whatever they want, but if so, I don't want to bail them out.