We need to get some perspective on what caused the recession

We need to get a sense of perspective, which is completely lacking lacking at the moment. We have just endured the worst recession in 60 years and the mother of all credit crunches.

There were 46,000 homes repossessed in 2009, still lower than the 1995 figure at the tail end of the downturn in the late 1980s. There were some obvious areas to avoid such as the combination of self-cert and severely impaired 90% LTV remortgages. But for the majority of people the market worked well and banks made money out of it.

The losses banks have made have been largely caused by dubious bond trading in collateralised debt obligations, speculative developers and commercial property borrowers.

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