Subprime Mortgage Crisis in USA

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Th subprime mortgage crisis was a sharp rise in home foreclosures which started in the USA in late 2006 and became a global financial crisis during 2007 and 2008.Loan incentives and a long term trend of rising housing prices encouraged borrowers to assume mortgages,believing they would be able to refinance at more favourable terms later.However,once housing prices started to drop moderately in 2006-2007 in many part of the USA refinancing became more difficult. Defaults and foreclosure activity increased dramatically as the Adjustable Rate Mortgage interest rates reset higher. According to an estimate during 2007, nearly 1.3 million US housing properties were subject to foreclosure activity,up 79% Vs 2006. As of December 22,2007 a leading business periodical estimated subprime defaults would reach a level between US $200-$300 billion. The value of US subprime mortgages was estimated at $1.3 Trillion as of March 2007, with over 7.5 million first lien subprime mortgages outstanding. Approximately 16% of subprime loans were 90 days delinquent or in foreclosure proceedings as of Oct2007,roughly triple the rate of 2005. By January 2008,the delinquency rate had risen to 21%. By keeping in consideration the above facts do you justify the subprime mortgage crisis as the failure of the Fed Government or the failure of the people without proper financial planning?????? Sadanand.