So, real estate loans have been turned into marketable securities, and some of thes securities aren't so good.
Well color me surprised. I know someone who literally was refinanced over the phone. No one checked his work history, I suppose they saw his credit rating on line, but no one went out to see if his friggin' house hadn't burned down since the original appraisal! He could have gotten a refinance on an empty lot! And now, these nincompoops who would loan someone actual cash money on a property worth more than $1.5M dollars, sight unseen, then turned the paper for a profit is having problems, not to mention the people who bought his (possibly worthless) paper. And now, we taxpayers have to send truckloads of US taxpayer cash to a bunch of bankers who would literally loan people money over the phone, without any kind of due diligence. Well, fine.
However, I think no-risk capitalism should work from the bottom up, not the top down. Let's re-do the "bad" mortgages. Let's take another look at the "sub-prime" mortgages, and who got them and why.