A sparsely attended Senate Banking Committee hearing on Thursday began with a blistering attack on the Bush administration's fiscal policies by chairman Chris Dodd (D-Conn.).

Dodd said loose regulation, unscrutinized lending practices and especially greedy mortgage policies have triggered the stock market plunge and credit crunch. Due to the congressional recess, only Sens. Mike Crapo (R-Idaho), Robert Casey (D-Pa.), Robert Menendez (D-N.J.), Daniel Akaka (D-Hawaii), and Sherrod Brown (D-Ohio) were present.

Dodd took special aim at the mortgage market, saying federal regulators either ignored or didn't notice that high-risk mortgages were rampant despite falling housing prices and growing risks of foreclosures.

"It is clear that greed and avarice overcame sound judgment in the marketplace, causing some very smart people to act in very stupid ways," he said. "But what makes this scandal different from others is the abject failure of regulators to adequately police the markets."

Thursday's hearing will feature testimony from former Securities and Exchange Commission Chairman Arthur Levitt Jr. and former U.S. Currency Comptroller Eugene Ludwig.

-J. Taylor Rushing