Locomotive

>>"The lax lending standards and loose monetary policy was the effort by the federal govt and Federal Reserve to mitigate the crash following the tech-bubble."

I would disagree. They committed themselves to the creation of a new bubble to replace the dot-com bubble. They did this fully aware that the consequences at the tail end would be even worse, because the phony housing bubble would hit more average citizens right where they lived ( literally ) than the more speculator-oriented dot com bubble, which was more of a 'stock players' crash.

I don't care how many times the Fed tries to correct an economy overdriven by loose credit with more loose credit- it's the wrong prescription, every time. When the economy stalls after a credit-driven bubble, it is demanding rest and rehabilitation to return to equilibrium. The Fed prevents this by hurling even more coal into the locomotive.

It's like rushing to the accident scene where a drunk driver has just crashed his car, handing him whiskey and the keys to another car, and telling the drunk to 'Get back on the road and drive even faster!'

You have to let the economy sober up, not hand it more poison.