Anyone who didn’t see this coming was either not paying attention, an idiot of the first order, or delusional.

I saw this coming from far away, and I was neither in the industry nor am I am Harvard man. Anyone, when asked in a common sense fashion, understands that when you lend money to people who (a) can’t pay the loan and (b) don’t have sufficient collateral, you’re going to lose the money. This isn’t rocket science.

Some people managed to convince themselves of things that just aren’t and can’t ever be true, like asset prices that rise indefinitely. It’s the same psychological phenomena that allows people to believe that the War on Drugs can be won or that America is always in the wrong. Evidence has no effect on them. We are in this sorry state because too many crazy people all believed the same crazy shit at the same time.