Banks did what they were supposed to do. In that sector, in those circumstances, if you don't ride the wave with the others, you get left behind.

Banks did have "counterparty risk insurance" on their assets - those CDS (credit default swap) things. (Like the other banks. And thus the CDS provier AIG "failed", because - of course - all their insurance contracts were correlated / not independent enough.)

I'm not saying they are/were angels. There were seriously in the stupid zone just from a technical point of view. ( See that table: https://www.econlib.org/archives/2013/05/conditional_ins.htm... )

I think the important distinction between all the banks are stupid and a stupid systemic failure of banks is important. After all, a lot of banks were not stupid, and stayed afloat well, without any sort of bailout.