In short, the explosion in sub-prime lending was a thoroughly top–down, political project, mandated by Congress, implemented by government-sponsored enterprises, enforced by the law, encouraged by the president and monitored by pressure groups. Remember this when you hear people blame the free market for the excesses of the sub-prime bubble. It is simply a myth that the problem came from deregulation. There was a progressive and enormous increase in regulation during the period in question.
