Can someone explain to me the housing crisis 0f 2008?

Banks and other lenders took advantage of deregulation to invent what was essentially a real estate casino. Many people were sold ARMS, or adjustable loans so they could buy a house. The early payments were more than affordable and the pitch was that the value of the home would increase long before the payments would 'adjust' upward. These loans were then sold as a package to other investors as 'loans secured by ever more valuable real estate'. These investors in turn often sold pieces of these loan packages to other investors. Suddenly, the value of real estate stagnated due to over building. The housing industry couldn't build fast enough to accommodate all of these new sub-prime home owners. Oops, too many houses. Then, the loans 'adjusted'. Now these thousands of sub-prime mortgagee couldn't make the higher payment and the house was worth less than when originally purchased. People defaulted. The banks couldn't get their money back. Bummer! Fannie and Freddie had guaranteed these loans, but surprise, surprise, they couldn't cover all the bets. Mo couldn't pay Curly and Curly couldn't pay Larry. So Uncle Sucker now has to bail everyone out with borrowed or printed money. That should be a picnic down the road for sure. This is the reason why we need a lot of regulation....someone has to watch the hen house...someone beside the fox! That's why i'm voting for Sen. Obama and the democrats...they get it....the GOP hasn't a clue!