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Originally Posted by dogzilla
So I don't see the bank taking an unreasonable risk here. I also don't see any justification for the borrower walking away form the mortgage because his equity disappeared. I've never heard of any kind of guarantee that property values would not decrease. So now the taxpayer or the shareholders get to make up the loss.
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It doesn't matter whether the risk was unreasonable or not. They took it and it's blowing up in their face.
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Maybe I should have taken the long term liberal view, maxed out my credit and let Obama foot the bill 
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Actually, I think you'll find that it's the view of a fair amount of conservatives, provided one replaces the homeowners in this scenario with private businesses. It's a fairly common business practice to declare bankruptcy when it makes financial sense to. One might even argue that that's what bankruptcy is for, whether it's Joe down the street or Enron or Lehman Bros.