>None of this happens without Fannie/Freddie's increased backing of subprime loans and the repeal of Glass-Steagal. If anyone can argue differently, I'm all ears.
>
>Plenty of people argue differently. First, the rest of the world has done fine without a G-S bill and without a banking collapse, so how is it believable that repealing it in the US caused a different result?

??? Banks are failing all over the world. Perhaps they too need a Glass-Steagal type bill.

>As for F/F backing of subprime loans: F/F *did* have rules about security and risk, but the sub-primes were falsely repackaged as gilt-edged investments.

Fannie/Freddie, bowing to governmental pressure, changed their rules in 1999 regarding buying subprime loans from banks and lenders. That decision had nothing to with false re-packaging. That occurred further down the food chain.

>IOW the bankers at F/F bought into the same Emperors' Clothes deceit as the rest of the banking industry that got sucked into subprime.

I'm certain this has been posted before but in case you missed it.
http://www.nytimes.com/1999/09/30/business/fannie-mae-eases-credit-to-aid-mortgage-lending.html?sec=&spon=&pagewanted=1

>The only reason to uniquely pick out the bankers at F/F for blame is so that people can blame government.

I point them out because without their decision to buy the subprime loans, thereby implicitly backing those loans with the federal treasury, the subprime explosion doesn't occur. Just as without the repeal of Glass-Steagal the housing-backed derivative market doesn't take off, threatening commercial banks' solvency. You're damn right I blame our elected representatives, because they're the one's responsible for getting the ball rolling. They're not alone, by any means, but their bad decisions led to all that followed.