Im not naive enough to think that this is the only cause of the crisis, but these are valid points in their own way. Just like the banks (in order to turn a profit and protect themselves) took advantage of a federal mandate to hand out money, the people involved took advantage of cheap money to make a buck on resale and live beyond their means. The fact that people making $30,000 a year are losing their $500,000 homes has yet to cause me to shed a tear. They should have never lived in them to begin with.

The housing market has not yet reached the bottom. The 5 yr ARM's that were issued at the peak of the boom are going to be coming due for resets over the next couple years. It wont be a problem as long as rates stay where they are(0%), but as soon as the Fed moves, another wave of foreclosures is sure to break.