Subprime Mortagage Crisis - US is doomed

I am sure that you people have heard about the Subprime Mortgage Crisis of 2007 in US which is threatening to throw the country into a recession. But there is very little that we know in detail about this phenomena called subprime lending which when started promised to be a torchbearer policy of modern world economic reform.
Let us go into history and see what this Subprime lending is all about and does India face a similar Crisis as US or will it be affected by the US Recession.
Definition:
Subprime lending refers to the practice of making loans to borrowers who do not qualify for the market interest rates because of the problem with their credit history or the inability to prove that they have sufficient income to support the monthly payment of the loans which they are applying.Now since the lenders are taking a risk by lending loans to such people they also charge higher interest rates for these loans. Of course, such the lenders chose to tread such a path because of the greed of higher returns on the loans.
Subprime Loans were usually issued to finance mortgages and hence they were considered a boon as they increased the opportunities of homeownership. It added nine million households to the list of homeowners and catapulted US into the top tier of developed countries
But soon the ugly face of Subprime lending started showing up its face. When the borrower was not able to pay his loan installments on time the lenders levied a fine for late payment (which was of course more than that of a prime loan) which was added to the loan and thereby adding more load on the borrower. The borrower usually fell into a vicious never ending cycle and became a defaulter. In late 2006 the US subprime mortgage industry entered in what many observers refer to as meltdown. A steep rise in the rate of subprime mortgage foreclosures has caused more than 100 subprime mortgage lenders to fail or file for bankruptcy, affecting the whole US economy.Are you finding it difficult to understand? Here is an example.
Tom and Wendy bought a sea facing home for 600,000$. Tom earned around 100,000$ per year and Wendy around 30,000$. Even though Tom had bad credit history the bank approved its loan (on higher interest rates). They moved in the house expecting the good times to last forever. Suddenly Tom lost his job this year and the monthly mortgage seemed too expensive. On top of it the price of the house declined to 500K $ so they decided to apply for foreclosure. (Hope this example makes it clear what is happening with millions of people in US)
But is that the only reason for the imminent danger of US recession? Well there are other reasons too..• Because of rising population, the US needs to create on average 120,000 additional jobs per month to keep the employment rate stable. But in August the US actually lost 4,000 jobs. This looks more a trend than a blip.• Predictions that the economy is going to slow down to only 1% this fiscal (the economy of US grew by 4.5% last fiscal)• Real estate prices have fallen down by almost 10% nationally (real estate prices have also fallen in India in metro cities although not nationally)• Rising fuel prices (the light crude oil reached a record 100 $ per barrel just yesterday)• Hidden costs for Iraq war coming out (1.5 trillion $ - that’s 20000 Us $ per house hold per anum!!!)
What are the implication for India..will the US recession affect india in a big way. I don’t think so. India is relatively cushioned against the US recession as it does not totally depend on exports to that country. The last time US faced recession was post 9/11 during which time Indian economy was on an upswing. Yes the IT companies might show a dip in profits so India is definitely going to get a chill from the US sneezes  Now US has ceased to be the sole locomotive of the world yet US accounts for a quarter of worlds GDP. So Indian GDP growth might fall from recent average 9% to 7% but still it is impressive.
Economist joke that a recession is when your neighbor loses his job and a depression is when you lose your job too. By that token a depression is not even on the horizon, let alone a devastating breakdown of economy. The good times will continue to roll in India, albeit a little slowly.