Who is to blame?

So I keep hearing there is a massive financial meltdown in banking and on Wall Street.

Where I stand it is much ado about nothing. I count myself lucky for that.

5 years ago i was in the market to buy a house. I was single, making nearly $50k a year. I truly believed it was time to take advantage of the great deals. Today, i am back to my post college salary, and can barely squeak by on my month to month rent. Why did i not by a house when i had the great opportunity.

First and foremost, I am intelligent. I always do the most research possible. I looked at my present situation, added to that several varying scenarios for the future, and told myself, "This is too risky for me to take out a huge loan for a house" Might I add, I am also a seer. (only joking)

You ask why i tell this story, when the subject of my post is 'Who is to blame?' Well I know if i was in the boat of no longer being able to pay off my loan. I would be the first to step up and say it was my fault. I have friends and family that are going through the possibility of losing houses, and yet they only look at what they could do or could have done differently.

So i guess my first idea of who is to blame is the person that took out the loan. In a 'desperate' need to get out of the shackles of renting, they forged into a new territory without the full knowledge of what is completely at stake.

But i am not done.

(Made up story)
I am a bank, I offer loans to new home buyers. I did my job by very strict rules. I was only able to loan to those people I could assuredly say will pay the loan back(preferably at the full length of the loan), and for homes in safe and secure areas.

Somewhere along the line an entity more powerful than I, stepped in and said "you can no longer 'redline' certain areas and people of certain stature, you must find a way to give out those loans." So i went to the drawing board to find a solution to the problem, typically I do not oblige such demands, but when they come from the government both state and federal, I tend to do what I can to follow their instructions.

So, following the governments directive, I began loaning money to people and in places I most certainly would not have in the past. Giving them opportunities for lower down payments longer more secure interest rates.
(end of story)

That story is where i come with my second idea of who is to blame. Government, both states and Federal, all Legislative, executive and judicial branches. For amazingly it usually takes all three to screw up that bad.

(another made up story0
Here I am again, a bank. Facing some tough times, I have given out many loans in the past few years and many of which to people that I normally wouldn't consider. But now i am getting demands from my shareholders that i need to make more money. And if there is anyone I listen to more strictly than the government, it is my shareholders.

So back to the drawing board to figure out a way to turn these loans into some profit. Bingo, refinancing. I will get those people to reinvest the equity they have in their newly purchased home. Showing I have recovered fully from the first loan. In essence I will borrow money to Peter, so peter can pay me back. (oh I don't want to fail to mention, the second loan to Peter was worth more than the first and most likely not under the same, much more affordable, but not nearly as moneymaking as the first)
(end of this story)

So my third idea of who is to blame. The Banks, they took advantage of a rising economy and good housing market and pushed people into the refinancing game.

Although i do believe some of what the banks did was underhanded. It could have easily been stopped by being intelligent with your money and your loan. Unfortunately a lot people take what is given to them, and when offered more money, they take it, not ever realizing the cost to themselves or their future.

So back to the question at the top of my post. Well the answer is EVERYONE. but that isn't sexy or headline grabbing, so you probably won't see that as a headline. Plus in a major election year, you won't see anyone ever taking personal responsibility for any of their own actions, and you will certainly not see anyone blaming the citizens for not educating themselves fully.

So now that the blame game is over. How do we fix it? Let me think on that one. I have some ideas of what do once we are free of this strait. But currently I have mixed emotions on how to fix it. I am not one for putting people out on the streets, but i am also not into footing the bill for someone elses ignorance(especially when that someone else is an elected official)

Stay tuned, for my thoughts on where to go from here. (and trust me i don't think either major party candidate has it right!)