Subprime Issue:the chicken or the egg & who bears the price?

Implications: The current subprime problems will likely affirm the need for things like Sarbanes-Okley & Corporate Governance? While the US has certainly developed a reputation for being litigious, holding some accountable for the fall out on the subprime issues should not be limped in this category!

Analysis: As a result of the subprime issue, there clearly has been an increase in the number of subprime lawsuits.  while the general areas targeted range from Securities, commercial contract issues, employment class actions & even bankruptcy, this is just the tip of the iceberg. The interesting dilemma is that many are still at odds as to what really caused this problem.   http://www.businessweek.com/investor/content/mar2007/pi20070313_837773.htm.  Was it the decline in the market due to many other factors that lead to the microscoping of mortgages which lead to further market collapse? http://seekingalpha.com/article/36409-bulls-ask-what-subprime-problem.  Some are likely to argue that the American people took a chance with credit thinking things would just get better and when things went south are looking for an easy out.  Given the history of similar issues with the court system & the bad taste still fresh from Enron, the sting of this subprime issue is likely to fall on those more knowledgable about the system.  Any material misrepresentation or incomplete disclosure that lead people or entities into a transaction may come back to haunt those who profited most.  Importantly, the ripple effect of this crisis will be astronomical & one doubts that few shores will go untouched.