Well, the one thing that is for certain is that there is plenty of blame to go around. I will outline the arguments for the three most cited scapegoats.

1. The Government - With laws such as the Community Reinvestment Act and by bailing out troubled financial firms such as Long Term Capital Management, the government shifted incentives on Wall Street. Also, many administrations actively promoted subprime mortgages as a way for low income consumers to afford a home, further skewing incentives. These new incentives were skewed towards assuming high risk investments, such as subprime mortgages. In addition, the leaders of Freddie May and Fannie Mac (both created by the government) were friends of certain politicians, and gave large sums of money in campaign contributions to many politicians. Many members of the House Committee on Financial Services, which was in a position to stop this from happening, received money from Freddie and Fannie.

2. Wall Street - Securitizing bad debt and keeping it in banks. Typically when debt is securitized it is sold to consumers, but in this case banks kept a disproportionately large amount of their subprime mortgage debt in-house. When the market burst, these banks lost billions.

3. Home Consumers - Bought homes they could not afford, without thinking of the consequences. Agreed to borrow money at subprime rates without understanding what they were doing.

Who do I blame? I would give 75% of the blame to the government and 25% to Wall Street. If the government would have decided not to interfere in the mortgage market, this simply would not have happened.