How do mainstream economists explain the cause of the financial crisis that led to the severe recession of 2007–2008?

What will be an ideal response?

Mainstream economists see the cause of the recession as coming from a decline in aggregate demand. The financial crisis resulting from the bursting of the housing bubble led to a fall in investment spending and consumer spending, which are two forces that support aggregate demand. Business inventories increased and businesses further curtailed investment spending as the economy fell into recession. Unemployment rose and incomes fell, leading more consumers to cut their spending.