While politicians, talking heads, and bloggers blab about the causes of the mortgage crisis, Stan Liebowitz of the University of Texas lays out why they’re all dead wrong in today’s Wall Street Journal.

Rather than subprime or lair loans being the culprits, Mr. Liebowitz illustrates that zero equity lead to the mortgage meltdown.

The evidence from a huge national database containing millions of individual loans strongly suggests that the single most important factor is whether the homeowner has negative equity in a house — that is, the balance of the mortgage is greater than the value of the house. This means that most government policies being discussed to remedy woes in the housing market are misdirected.

Many policy makers and ordinary people blame the rise of foreclosures squarely on subprime mortgage lenders who presumably misled borrowers into taking out complex loans at low initial interest rates. Those hapless individuals were then supposedly