What is causing the current recession?

What is causing the current recession?
Long story short, the unrealized (that means paper rather than cash) value of stocks, equity in real estate and high debt created a situation where there was no value to back up the debt based on it. People and companies could not pay the mortgages and amounts due on huge loans and the situation went downhill from there.

Behind the scenes, laws and regulations had changed (or were being ignored--see Bernard Madoff and the SEC, as an example) to allow transactions and bookkeeping that disregarded best practices developed in the years since the Depression of the 1930's. Greed and the opportunity to make big money by our government, corporations and others--a lack of integrity--were contributing factors.

The recession is a situation where everyone is cash poor and cannot pay the bills they ran up based on the perceived wealth they had in real estate and in the stock market. Savings have been at an all-time low, so there is not a fallback position for most people. Baby boomers, who are nearing retirement, are at particular risk due to the cost of medical insurance and the loss of much of the value of their savings.