I’m going to disagree, and to some extent I think you prefer the simple narrative with bankers as villains.

I worked on a prop trading desk with some housing bears, who made some significant gains with shorts. While they understood that certain markets were overheated, I don’t think any of them suspected the breadth and depth of the crash that was coming. While their models were better than the other guys, in the end they were really wrong too. Just less wrong then the guys who went long.