Understanding the Financial Crisis

For those of you who have trouble understanding how increased home ownership led to bankruptcies of even non-financial companies, like Circuit City, which is going under as of today, here is a nice visual graph depicting what led us down that road.

My own take is that we generally have two types of people to blame:
1. Mortgage officers who let standards slide and put people into houses they could not afford.
2. Homeowners who requested loans on houses that were obviously out of their price range and budget. These same people, through their ignorance, chose to go with financial products such as interest only loans, that had a great potential to increase their monthly payments. Failure to hedge against this risk by taking out a fixed mortgage was