The Biggest Cause Of The Financial Crisis? It's Leverage: Roger Lowenstein

bloomberg.com:

Foreclosures by consumers heavily weighed on the economy, but what triggered the credit crunch was the failure (or near- failure) of the banks that issued (or acquired) the mortgages. In short, the root cause of the meltdown wasn't that customers borrowed too much; it's that banks lent too much.

This isn't to deny that many subprime loans were exploitative, and that customers often didn't understand repayment terms. Nor is it a bad idea to police banks, preventing them, for instance, from charging unreasonable fees.

Read the whole story: bloomberg.com