I'm sure that's largely true, but such events can be read about in books. They do happen every three generations or so. All it takes is for a generation to forget just how treacherous a friend debt can be, and we're off to the races again. The longer ago the last such bubble, the easier perhaps to forget.
Perhaps back at the start in 1985. By the time a bubble is going, a greed-maddened public will simply replace any politicians who try to get in the way. I recall that even back then, Margaret Thatcher was advise to curtail the nascent housing bubble by removing mortgage interest relief. Having a good understanding of her public, she stated "Over my dead body".
That assumes that the economy is something under someone's control. It isn't. It's just a bunch of people trading with each other. To that extent the economy is a tool. If people misuse it, it will break.
People thought that by continually trading houses to each other using higher and higher numbers on the cheques, they could get rich. In a way they could, by borrowing against those higher values. Unfortunately all that debt still needed serviced, though some seemed to assume it was somehow money for nothing. It's no different from Fred and Barney becoming millionaires by selling each other their caves, swapping houses, and then each smashing up the million quid tablets.
It can't be stopped, but anyone who tries can be replaced.
They're not trying to help as yet. They're trying to resurrect the bubble. See the nonsense about restarting the securitisation markets so that we can go back to the banks making dodgy loans and then passing them onto someone else in a long chain of pass-the-debt-bomb.
They're nuts and they're throwing all our future earnings at a problem that has already solved itself. The securitisation markets were part of the problem and their death is part of the cure.
Demand will return to pre-bubble levels because people are going to have to relearn to save and spend rather than borrow-and-spend. The businesses which built up to service the borrow and spend mentality will have to shrink or vanish because they're making more than we now want. That's already happened with cars. It will happen with a great deal more. We'll all be the poorer if we continue to pay for people to make cars which they'll simply have to rent space for while they rust.
Most? No.
Most? No. Many? Yes.
They'll go bust and be reposessed eventually anyway. The reset is underway and cannot be reversed. It can be slowed though, in which case those businesses and people will lose yet more money befre they go under. Quite how that does the owners or people a favour escapes me.
I'd hardly call throwing trillions at the problem an "efficient" transfer. We might later need that cash to help people.
FoFP