Explanations

Jax at AMERICAblog says that this piece in the New York Times is "the best explanation of what the heck's going on with our economy." 

Jax is wrong; Atrios has a better explanation.  See below.

As for what to do about all this, here's a good idea:

Representative Barney Frank, chairman of the House Financial Services Committee, said the excesses of the subprime mortgage crisis will result in a new era of regulation, similar to those that broke the monopolistic trusts of the early 20th century and restored the financial system following the Great Depression.

I only hope we don't have to "follow" another great depression before these overdue reforms are enacted.