Right through out the forumosphere I keep seeing people blame American sub-prime lending for the world economy's woes.
It's not sub-prime's fault at all, it is merely the first symptom of the cause.
No, the cause is the ludicrous loosening of credit originating from the US Federal Reserve, & subsequently the other CB's, starting in 2001. If CB's had never taken that action, sub prime (and the CDO nonsense) would never have become an issue. Loose credit ==>> boom ==>> malinvestment ==>> bust.
On my blog there are a series of video lectures on economics which explains the whole shebang (which I've posted before).
It's Greenspan's fault... and now he's trawling the world shifting the blame onto whoever else he can, to ensure his place in history is not sullied.
Uncle Ben has picked up the baton now too.