“…if ‘subprime’ was in fact a new financial euphemism for ‘black.'”
More on the “diversity recession”:
The other item I would add is the effects of political correctness and discrimination lawsuits on financial institution’s ability to perform reality checks on their own actions. Nobody can send a memo to their colleagues saying “We lent a billion dollars to Detroit?” without being in severe danger of it turning up in the discovery of a redlining discrimination case.
Beyond that, it was just totally uncool to point out that Detroiters, where the high school dropout rate is, what, 75%, couldn’t really make enough money over the next 30 years to pay for all that bling they were buying with home equity lines of credit. Who wanted to hear it?