Why did the economy tank after Democrats took over the legislative branch in 2006?

because they wanted it to. They needed it to fail. They were trying to retake the white house based on "Change" People don't want a change when everything is going well. So they talked down the economy, and attacked business. They deliberately ignored looming crises to exacerbate the problems. In order to paint Bush as an utter failure, they had to destroy the economy. They did it deliberately. And it worked, they destroyed the country and gained the overwhelming power they always wanted. But now they are the captains of a sinking ship. And rather than bailing out the water and patching the holes, they are driving full steam ahead into a mine field.