What caused the economic crisis?

I actually asked somebody this the other night.

I always thought it was because consumers were spending more than they were earning.

The person I asked told me they felt it was the Clinton's fault-IDK.

I am not sure why don't you bring that up to FDR when you see him in heaven or even when we had the Market Crash of 29. A lot of things come into play and you can't blame just one person. We have wars and greedy bastards and people trying to live the american dream that really don't have the funds to do so. Sorry for the word usage with "bastards". Thats my opinion on it though.:)

i believe that a lot of American people were living out side of there means, they were bringing in money but not enough to cover there bills, plus a lot of people bought houses that they could not afford and they did not read the fine print until it was to late and there mortgage payments went through the roof. and the banks are also at fault for lending out the money for those people to get those homes.

Much of it was due to the housing boom, and the fact that people who normally wouldn't qualify to get a mortgage loan were able to get a house with an ARM. Then when rates went up so did their mortgage payments. Also, a lot of people and businesses were living on credit and way beyond their means. Besides, the economy is a cyclical thing. What goes up must come down as they say. It is true for the most part.

1) Americans living hugely outside of their means. We have become consumers, and that's what we do. Consume. Many people were (are) spending three and more times their salaries monthly.
2) Gas prices rose astronomically. This forced many people to reevaluate their spending situations and spend less, and contributed to the rise in price of shipping and production of food.
3) in an effort to counteract gas prices, The gov gave farmers growing corn a nice size tax credit for the production of ethanol. Many more farms began producing corn, which with simple supply and demand, meant the price of everything went up. (less of everything to go around.) Con't

4) There was a government program out to help people achieve the great American dream of owning their own home. People were able to purchase a home with poor or no credit, little or no down payment, and very little research into their actual finances. Many people that should have bought a home for 100,000 bought one for two or three times that. Then the rates went up. Their mortgages went from an affordable 600 payment to 2,000 a month. All of this was pretty clear in the flyers we looked at when we turned it down.
5) So now people's bills have in some cases, quadrupled or grew by a greater amount. In some cases, people weren't even bringing in enough income to cover their mortgages. con't

Add to that, the astronomical cost of gas and food, and needless to say, precious few are buying Jimmy Choo's anymore.

Once the general population cuts back on their spending, the industry has to respond by cutting production, which also means cutting jobs, in turn putting less money into the market and causing furthur reduction in spending.

It happens every so often. Seems to me about every ten years. It keeps the system in check, as uncomfortable as it is.

Clinton paid off debt, and fixed a lot of budget problems, but in order to do all he did, he had to get the rich people to go along with it. So he "helped" the rich by deregulating the stock market, and getting it to where the every day people could afford to purchase stocks-leading to a stock market boom. The stock market big guys then started playing around with this excess of money, putting a lot of money into real estate. Bush came in power, got distracted with 9-11 and wall street was deregulated even more, leading to a few manipulators to get rich.
*CONTINUED BELOW*

People thought America had all the money in the world, took out loans they could not afford. Because loans were not being paid for, the investments made into the real estate industry stopped producing. Snowball effect, when people are not paying for the loans they take out, the mortgage/credit industry fails, leading to the collapse of the investors (in this case the big guys on wall street). ***At least this is my take on it all from research I have done :)**

Add to what lovinangels already said, the fact that Clinton has said recently (a few times, actually) that he mis-managed things and laid the ground work for a lot of what collapsed. The economy cycles about every 10 years with dips and spikes...sometimes they're little, sometimes they're extreme.
Above all else is the fact that too many people were living solely on credit and when things ballooned, they stopped being able to pay their bills which caught them in a downward spiral and screwed the banks, too.