A Crisis so Severe, the World Financial System Is Affected
A Crisis So Severe, The World Financial System Is Affected
Following a period of economic boom, a financial bubble—global in scope—has now burst.
A collapse of the US sub-prime mortgage market and the reversal of the housing boom in other industrialized economies have had a ripple effect around the world. Furthermore, other weaknesses in the global financial system have surfaced. Some financial products and instruments have become so complex and twisted, that as things start to unravel, trust in the whole system started to fail.
John Bird, John Fortune, Subprime Crisis, February 14, 2008
While there are many technical explanations of how the sub-prime mortgage crisis came about, the mainstream British comedians, John Bird and John Fortune, describe the mind set of the investment banking community in this satirical interview, explaining it in a way that sometimes only comedians can.
Together with impressionist Rory Bremner, derivatives (securities derived from other securities) are also explained:
Bremner, Bird, and Fortune, Silly Money: Where did all the money go?, Part 3, November 10, 2008
Bremner, Bird, and Fortune, Silly Money: Where did all the money go?, Part 4, November 10, 2008
The betting of practically anything helped create enormous sums of money out of almost nothing. However, as former US Presidential speech writer, Mark Lange, notes, “because [derivatives are] entirely unregulated and trade on no public exchanges, their originators can deliberately hide their vulnerabilities.”
Jonathan Jarvis explains the causes of the credit crisis in a short, engaging video:
The Crisis of Credit Visualized, Jonathan Jarvis
If you are unable to see the video, or, for further details, the next two sections go into this further.
Securitization And The Subprime Crisis
The subprime crisis came about in large part because of financial instruments such as securitization where banks would pool their various loans into sellable assets, thus
Following a period of economic boom, a financial bubble—global in scope—has now burst.
A collapse of the US sub-prime mortgage market and the reversal of the housing boom in other industrialized economies have had a ripple effect around the world. Furthermore, other weaknesses in the global financial system have surfaced. Some financial products and instruments have become so complex and twisted, that as things start to unravel, trust in the whole system started to fail.
John Bird, John Fortune, Subprime Crisis, February 14, 2008
While there are many technical explanations of how the sub-prime mortgage crisis came about, the mainstream British comedians, John Bird and John Fortune, describe the mind set of the investment banking community in this satirical interview, explaining it in a way that sometimes only comedians can.
Together with impressionist Rory Bremner, derivatives (securities derived from other securities) are also explained:
Bremner, Bird, and Fortune, Silly Money: Where did all the money go?, Part 3, November 10, 2008
Bremner, Bird, and Fortune, Silly Money: Where did all the money go?, Part 4, November 10, 2008
The betting of practically anything helped create enormous sums of money out of almost nothing. However, as former US Presidential speech writer, Mark Lange, notes, “because [derivatives are] entirely unregulated and trade on no public exchanges, their originators can deliberately hide their vulnerabilities.”
Jonathan Jarvis explains the causes of the credit crisis in a short, engaging video:
The Crisis of Credit Visualized, Jonathan Jarvis
If you are unable to see the video, or, for further details, the next two sections go into this further.
Securitization And The Subprime Crisis
The subprime crisis came about in large part because of financial instruments such as securitization where banks would pool their various loans into sellable assets, thus