Raguram Rajan owes his status as a GFC oracle in large measure to having correctly perceived in 2005 that these derivatives, rather than insulating against risk, were creating greater systemic risk.
The problem with that story was that the CRA was passed in 1977. It's true that the Clinton Administration began pushing banks to meet higher CRA targets in 1995, and the Bush administration continued those policies. But the CRA only covered banks. By the late 1990s, when the Housing Bubble got started, most mortgages didn't come from banks; they came from independent mortgage lenders not covered by the CRA.
