In 1980, depository institutions, primarily savings and loan associations, held two-thirds of home mortgages in their portfolios. That proportion has fallen to less than one-third today. Over the same period, the share of mortgages that are securitized has risen from 10 percent to 59 percent.
The extent of government intervention in markets to control risk-taking is, at the end of the day, a tradeoff between economic growth with its associated potential instability and a more civil but less stressful way of life with a lower standard of living.