Question: Have you looked into the federal reaction to the Savings and Loan crisis? If you haven't, you should.
Not only does it explain exactly why the housing crash collapsed the financial market, it also explains why the United States has, since the early 90's, increasingly looked the same nationwide.
First, the Federal government shut down S&L real estate loans.
Second, because the real estate market was now tanking because the primary investors weren't around anymore, the Federal Government set up a panel to begin the commoditization of real estate.
Third, to encourage this new source of investment, real estate investments were given special equity status, equal to bonds or other "secure" investments.
Fourth, when the housing market crashes (as it does every now and then), and the paper value of investments fell, the insane leverage laws which the real estate equity helped companies more heavily utilize caused those companies to become insolvent.
Perverse incentives lead to perverse results.
Just found this curious hypothesis:
http://www.theatlantic.com/magazine/archive/2009/12/did-christianity-cause-the-crash/307764/
"I looked at what I think of as the food chain that led to the financial crisis, which was that you had individual consumers buying houses they couldn't afford, sold to them by realtors and property people who were competing to sell more properties at a higher price and so on. [...] I thought, hang on a second, classic economy theory tells you that a competitive marketplace is superior because competition provides a diversity of products which is good for the consumer, and it also, therefore diversifies risk. And yet, in this instance, competition has led every single one of these companies to copy each other, which had concentrated the risk. And I thought, Wow, that's interesting. That's specifically what's not supposed to happen."
More here.