Is this the end of Capitalism in America !!

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Sub-Prime crisis that have started in America has made the entire world suffer !! The American banks greed to make more money by giving loans to people who do not have the proper credit rating have made the entire financial market to collapse !! But have you ever wondered why did these banks lend so much money to people who doesn't have proper credit rating ?? In 2006 the US federal reserves bank made huge amount of liquidity available to the banks !! These banks had no clue where to invest the money and started lending to these sub-prime members !! Then as demand for real estate grown more construction companies tried to capture the demand, which resulted in the fall of real estate prices !! Then as prices fell these sub-prime people never paid back their loans !! There it all started fall of banks one after the other... But something seems to be fishy to me, why didn't the Federal reserves bank restrict the liquidity and put a check on the sub-prime lending in the first place !! That seem to be pretty planned to bring every bank in America in its control when they fall !! Now the 700 billion dollar bailout seem to be just doing that !! After taking substantial stakes in these biggest banks of America these companies are restricted for ever !! Gone will be the days of financial freedom for these companies !! The capture of freddie and fannie is just an indication of end of private Capitalism in United States of America !! It seem to be moving towards the Communist-Capitalism !! Guys post your views in US sub-prime crisis and contravertial facts behind the entire drama !! Hope you will enjoy my discussion !! Happy My Lotting :)