The history of the crash goes something like this. Lenders made (or misled people into) mortgages that couldn’t be paid back.
Then, with the magic of math, banks claimed that bundles of these crappy loans were actually as good as gold—or Treasury bonds—since, the story went, they wouldn’t all go bad at once.
That was enough for the credit rating agencies to put their top-rated, AAA stamp of approval on this financial alchemy. Which was enough for investors to gobble up all this toxic waste.