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Banks
I think the reason we are in this mess is because banks can make more money
lending $100,000 at 15% interest to someone who has bad credit history and
is a high risk customer, rather than lending at 7% to a good customer who
has an excellent credit score.
I saw it all the time in real estate. In 1990, a buyer could not buy a house without having a down payment of 5% or more. Soon afterward, banks started offering zero down loans, so the buyer is more likely to walk away from the loan, walk away from the house when they cannot make payments, because they don't have any of their own money invested.
A few years ago, the headlines were, "banks have the highest recorded profits in history". Banks caused this problem by being greedy, and making high risk loans. Just my input...
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