Your link does not contradict any of the following:

1. That the Securitization process was unregulated.
2. That there was no policing for the creators, brokers or recipients of subprime or 'novelty' loans.
3. That there is no regulation in CDS market, which is also badly and gravely unbalanced now because of the MB Securities are supposed to insure against loss are now of spurious value. A huge swath of the CDS market (15 trillion in the US) are directly tied to MBS paper, thats the next domino, and what people are really damn scared of
4. There is no regulation in the derivative market, of which CDS and MBS are subsets of
5. De-regulation allowd the creation of 'insurabrokeragebanks', institutions so large and so leveraged and so enmeshed in conflicting busness interests that the failure of one or at most two could detablize the entire world financial and capitalization system, as is what came to pass
6. 1,2,3,4 and 5 are the origin point of this crisis
7. the lack of regulation in 1,2,3,4 and 5 are what republicans fought for and are consistent with the 'first do no regulation' ideology of the republican party

Thus, your linked article does not prove that de-regulation as the cause of this failure is a myth. What it does is weakly try to assign blame on China(!?)

It also points out an effective counter argument to your thesis (and its very own thesis): Fannie Mae was responsible for the securitization of at most one third of the 'junk mortgages' (my research has it pegged a lot lower, so I think thats a little high, but whatever). But this means at most they securitized 1/3rd of the junk. Whose responsible for the rest? Pixies? Or perhaps maybe, I dunno, private banks like INDYMAC, WAMU????

The article does not effectively alter what the core mechanism is- Unregulated brokers colluding with banks wrote bad mortgages- often to people the mortgage lender knew was lying (I took a home loan in 2003 and a refi in 2005, you would not believe the crap mortgage brokers threw at me and even encouraged me to do!). Then the banks created shoddy investment vehicles on top of this, which they traded in an unregulated global market. Fannie was a part of this stage, no doubt, but a small part.

So regulated institutions bought these assets? So it can't be a failure of regulation? Well, that sort of makes a contradiction to your argument and a point for mine: The SEC Failed to appropriately regulate these institutions! Thats the lamest damn 'wiggle' I have ever heard- the cause is not de-regulation or lack of regulation, just ineffective or incompetent regulation!? By an Executive Branch that has cut the regulatory staff and budget at the SEC to a wisp of smoke?

But more to the point, its not an effective counter to the criticism that any of the above 5 origin points has its root in un-regulated markets, practices, institutions or instruments. These MBS vehicles were founded in 2 layers of practices that were fraudulent at worst and spurious at best (The mortgage vending process and the securitization process). Both of those could have, and should have had policing. People were committing fraud on mortgage applications on the advice of Mortgage Brokers as a matter of course! Loans were being originated that the vendors had to know that there was little or no hope that anyone could ever re-pay the note! This was fraud, possible only because there was no accountability!

You can scream Fannie and Freddie all you want. You can try to pin this on the low-income families that fannie and freddie were invented to help. Because its an easy story that does not involve trying to pierce absolutely obtuse and obscure Financial Markets (Swaps, Derivatives and MBS's), 'Team Republican' is getting a lot of mileage out of that meme.

But the fact is that the underlying failure is well understood by anyone bright enough and patient enough to 'do the math'. And Fannie and Freddie, while a variable in the equation, played only a minor role in pushing us up to and over the cliff.

Yeti