Your explanation of the so-called "problem with Rand's theories" is entirely fictional. Government regulations like CRA caused the problem in 2008, not deregulation. All you have done is post the classic Marxist propaganda that blames private corporations for every problem created by government. Government has been the cause of every financial panic we've ever had, including the one in 2008. It's hardly an argument against laizzed faire economics. In fact, it's precisely the opposite.
That is simply not true. At worst, the CRA can be pointed to as a factor in the collapse of
the housing bubble. However, we have had numerous other bubbles burst in the last 30 years that didn't cause a catastrophic cascade across the entire financial sector, decimating the economy. The only reason that the housing collapse was any different was that the housing market got tied directly to the banking industry through the trading of mortgage-backed derivatives. And guess what made that possible? That's right, the repeal of Glass-Steagall, which allowed unfettered, unregulated practices in the financial district with absolutely no transparancy necessary. To suggest anything different is simply ignoring reality in order to defend a concept that has already been proven doesn't work.
That's leftwing propaganda. It is true. The CRA and govenrment regulators pushing banks to grant mortgages to unqualified buyers is what caused the sub-prime mortgage debacle. That's why it's called "the sub-prime mortgage debacle."
Liberals have tried to weasel their way around the facts and blame the banks for the problem, but any cursory analysis shows immediately that government had its finger in the process at every point, all the way from origination to securitization and purchase on the secondary market. The claim that under regulation of the banking industry caused the problem is too absurd for words. There are something like 50 different agencies regulating banks.
But, again, the sub-prime debacle, and the collapse of the housing bubble, should not, and
would not, have been enough to have caused the cascading collapse of the entire economy, any more than the dot com collapse, or any other bubble collapse over the last 20 years. It was the trading of those worthless mortgages through derivatives that caused the wider collapse of the financial sector. And that was only possible with the repeal of Glass-Steagall. That is the part you keep wanting to pretend didn't happen.