It ignores the whole cycle of leveraging and recycling that occured when weaponizing mortgage and asset backed securities into CDOs and insurance risk swaps. Sub-prime mortgages were the gasoline on that fire, they took what was perhaps a cabin burning in the woods and turned it into a 10,000 acre wildfire. With out sub-prime mortgages as an accelerator the who CDO mess burns out slowly and in when it starts burning the market moves away in a controlled manner.

To discount or even disconnect the sub-prime lenders from that fire is disingenuous at best in my opinion.

Put another way: if you've seen the movie The Big Short, it's like they cut out all the Florida scenes.

If you haven't seen The Big Short, it's still on Netflix.

Not the Florida scenes, they say subprime grew but it was still small compared to prime. The layering and diving and combining is the Jenga scene.

It ignores the role of government in demanding the issuance of more sub-prime loans.