Credit as a Source of Market Instability

Banks are far more speculative endeavors than market prices reflect (perhaps until now). They always have been and could continue to be. Banks are the primary participants of market credit and credit is typically collateralized. Collateral is the speculative fever of the era. Nearly by definition. According to the Webster Dictionary collateral is "property (as securities) pledged by a borrower to protect the interests of the lender". Americans have typically held the majority of their wealth in the speculative collateral of that period. Weren't you in tech stocks in the late 90's, aren't you currently cutting spending to cover your mortgage? Don't blame congress, don't blame speculative sellers, blame the market's tolerance for credit. Credit has been the speculative class that is always revived. Not real estate, not equities, not commodities, not technological innovation.... Credit was extended to the tulip connoisseurs of the mid 17th century, credit was extended to the investors of the Japanese commercial real estate bubble, credit was extended to the "tigers", credit was extended in phenomenal portions to the American working class. Hence the reason why I am surprised that economists say the market will bounce back when housing prices bottom. The market will bounce back when the credit markets find a new source of collateral. And this time, I don't anticipate it will be the average American Consumer.