You all have some valid points, but the underlying problems in our economy are deeper than "frivolous spending" or "cowboy capitalism" or whatever buzzwords are being thrown around. The middle class has been getting squeezed for years, income inequality has been increasing, education spending is dropping, the health care system is a mess, and spending on vital projects such as infrastructure have been delayed. The housing market was set up to fail, despite what the "industry cheerleaders" were saying for the past 5 years. Unfortunately, it seems that nobody really seemed to think any of these topics were a problem until recently.
When the middle class is hurting, they rely on credit cards to pay bills instead of savings. It is tough to get a good job, and has been for years, even with a bachelor's degree in a solid major (I should know!). We aren't teaching our kids well, as our schools have been a mess for many, many years and low expectations seem to be the norm, unless you live in a high-income area where parents are unusually involved in improving the schools.
Infrastructure spending obviously is key to keeping an economy moving: after all, how productive are workers going to be if they have to spend $25 in gas and 3 hours in a car each day to get to work? Yet, little or no priority has been given to increasing transit options, thereby forcing people into cars they can barely afford to maintain and gas they can barely afford to buy. Each year when I am in Japan, I am always blown away at how efficient the transportation system is, and wonder: why, in America, the wealthiest country in the world, put together a respectable plan to move people from point A to point B quickly and efficiently?
Health care $ spent here is much too high a percentage of GDP for a system that tops the world in cutting-edge treatment but lags in solid, basic care that increases life expectancy. Again, if people aren't healthy, then what is going to happen to worker productivity?
How much money have we thrown down that rat-hole in Iraq? What has this money achieved, exactly?
Any reasonable person could see that housing prices were quickly becoming unsustainable, and that loans were being approved for ridiculous amounts.
Where have the leaders of this country been? Nobody with 1/2 of a brain can say "gee, I didn't see this coming?"