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>Why "Veni, vidi, vici"?

Because it sounds even more naive than Mother Teresa plans to become head of Goldman Sachs.

Some interesting charts:





As you can see, both countries already had problems with employment.

And both successfully used banks (and as you could see from their debt problems, not only local banks) to make bubbles and reduce unemployment inflating them (so, bubbles are made from good intentions, usually, but could result in big problems).
We can see that medication really worked.

> why did the bubble burst? Is it not, because banks issued too much credit (hence too many people worldwide start defaulting on their loans)?

It burst because people are not machines, so they start to think that it is too much risk, too much debt.
So, banks could not find any more people to give them money (some do not want to get more and some can't be thrusted because they can't return even current amounts).

Back to my analogies.
You patient died due to extremely high temperature. Fast conclusion is that we used wrong medication and we must had fight this temperature using simple drugs. Under more detailed examination you'll see that it had sepsis and high temperature had been a way organism fights with the problem (unfortunately for patient, problem had been too large to handle).

Hmmm... market crash this year?

QE3 might be already being priced in.

Copper is the leading indicator. http://stockcharts.com/h-sc/ui?s=$COPPER&p=W&b=5&g=0&id=p86065272530

Not looking good.

I agree on the sepsis. The way money is injected into the economy is poisoned due to the way the money is levied (for private gain instead of social gain) before it is spent. You say the end of fractional reserve lending is too simple a solution. Yet as a solution it would take away the risk that banks can collapse, which i think caused the crisis. But i will look into it further to make sure this is correct. It is an interesting topic to study nonetheless.