Memo to Californians from everyone else in the world: You folks out there in sunshine land caused this historic global recession, and it's time for you to mend your ways.
Farfetched? Not really.
A very good case can be made that California's developers, mortgage lenders and house-hungry but income- deficient residents, with state and local officials as enablers, created an unsustainable housing bubble. And when that bubble burst, leaving holders of mortgage bundles – many of them overseas banks – with little more than toilet paper, it created a banking crisis that spread to virtually every other segment of the global economy.
No, it was not confined to California. It happened in a few other high-growth states such as Florida, Arizona and Nevada. But nine of the 10 top issuers of subprime and no-documentation mortgages were headquartered in California, and the state has been ground zero for the collapse of those mortgages as adjustable interest rates "reset" upward, having recorded more than a half-million foreclosures and other symbols of distress.