The credit crunch has dried up equity and the banks are saddled with
huge debts they can no longer sell off as CDOs... no more turning junk
to AAAs and making a ton of bogus money underwriting.  This in turn
makes any corporate debt offering more difficult and any loans much
harder to get... that's the straw that broke the camel's back.  All
this subprime lenders need to borrow money to survive since they're
losing massive amounts of money and banks don't have money to lend
because liquidity is gone from the system.

cibalo it's much more complicated than that... there's no such thing
as a free lunch and our economy is flooded with tons of dollars
printed at record rates... wall street underwrote these terrible sub-
prime loans to make an easy but selling the shitty junk bonds as
investment grade stuff by repackaging and making more money...
everyone was leveraged to their balls and borrowing money was almost
free because no one was defaulting while rates were ridiculously low
and risk was priced out of the market... do you know anything of
business cycles?

Looks like the market is going to collapse unless the government steps
in.  Just because you don't want it to happen doesn't mean that it's
not reality.  You think Wall Street can make record profits on huge
debt-fueled leverage forever and private equity could prop up the
house-of-cards indefinitely?  PE deals have been falling through for
weeks and the house is starting to crumble.  Subprime and financials
are at the forefront.