The housing sector in the United States, you might say, is completely different from municipal bond insurers; but when the housing sector starts going down, people start defaulting on their mortgages.

What else can they do; put them in the frozen bond market, or the sinking stock market, or the collapsing housing market?

As China and Gulf oil exporters purchased American Treasury bonds in order to hold down their currencies, this pushed down bond yields and helped to fuel the housing boom.