Housing Crisis Was Created by a Perfect Storm of Greed and Goals

Who's to blame for the collapse of the U.S. housing market? That question is at the root of the hearings being held by the Financial Crisis inquiry Commission, a bipartisan commission of former political officials. Republicans want to blame Fannie and Freddie for their risky loan practices, or federal officials for their lofty housing goals. The favored target of Democrats is Wall Street and predatory lenders.

The reality of the situation is that all three forces are to blame. The cast of characters and motivations reads like "The Bonfire of the Vanities": execs at Fannie Mae and Freddie Mac were worried about corporate profits; the government wanted to expand home ownership to low income families; and Wall Street and lenders were just looking to make an easy buck. All got what they wanted -- creating the perfect storm that ultimately led to the collapse of the U.S. housing marketplace.

So, it's doubtful the commission will be able to pinpoint a single culprit or the root cause of the problem. But that's not to say that the hearings aren't fleshing out some interesting plot lines.