I have been talking to a lot of people about the current mortgage mess and I have been surprised by how many people really don't understand what is going on and how big a role the US Government and two Government Sponsored Enterprises (Fannie Mae and Freddie Mac) played in causing this financial melt down.

To help I have collected a few articles and some videos that can help people understand the causes behind the current crises.

This is from the Wall Street Journal and I think it is pretty dead on:
 
Here is an article from Bloomberg:
http://www.bloomberg.com/apps/news?pid=20601039&refer=columnist_hassett&sid=aSKSoiNbnQY0
Here are a couple of videos that explain the mortgage mess.

1st one is a news report from Fox News. I think it is pretty dead on explaining the situation:

http://www.nypost.com/seven/09262008/postopinion/opedcolumnists/alarms__denial_130763.htm

The 2nd one turns into a bit of a campaign video at the end, but I think it still explains thing quite well. Personally unlike this video I don't think there are any heroes in this and I think many Republicans are just as culpable as the Democrats but if you filter out some of the election stuff I think it is pretty accurate and quite good. Finally here is an article from The New York Times from 1999 warning of this whole debacle. It is kind of like reading a report in 1992 warning of some guy named Bin Laden who plans a jihad against America or a report about a plan to fix the levies in New Orleans in 2000:

http://query.nytimes.com/gst/fullpage.html?res=9C0DE7DB153EF933A0575AC0A96F958260&sec=&spon=&pagewanted=1

 

My basic feeling towards the $700 billion rescue plan is that the old rule of "if you break it you bought it" should apply. The US Government played a major role in "breaking" the financial system. After all it was their Government Sponsored Enterprises that created the mortgage products and sold them to the rest of Wall Street that is causing this mess. Congress needs to own up to the mess they help create by offering to buy back the bonds that are causing this crisis. After all the Federal Government is the only one out there with enough capital to be able to do this

Hopefully if it is done right we can avert an ecomonic catastrophe and the taxpayers might even make a profit in the process. What our representatives in Washington need to do is to stop playing politics and pass the rescuse plan in a bipartisan way ASAP.