It is their fault in the sense that ignorance and greed are no excuse for overextending one's finances. However, what this really is imo is just another instance of an orchestrated transfer of wealth from the poor to the rich.
But don't think that the sub-prime lenders and even more so the big banks that bought up those mortgages and leveraged them even further didn't know what would inevitably happen. That would be as naive as the poor folks who took the bait of these exotic loans.
The fed will bail out the banks...they have to. That will be done by printing more currency which costs all of us...we'll be bailing them out, AGAIN.
And the wealthy will buy up the defaulting mortgages for pennies on the dollar after allowing the poor and ignorant who dreamed the American dream of owning a house of their own and got the original loans, built the houses, made payments on them for a few years and then lost their house and all the payments they made.
So the banks get bailed out, the rich own even more than ever and get a discount on the deal, and the poor...well now they get to rent the house they owned a few months ago.
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