15 Things You Need to Know About the Panic of 2008

[giza]

Found an article over on Kiplinger.com that discussed the events that led up to the current financial panic, starting in about 2000 or so. It covers subprime mortgages, how they "infected" so much of the market, and what caused all of the defaulting on those loans:

http://www.kiplinger.com/features/archives/2008/09/how_the_financial_crisis_started.html

Enjoy!

Comments

[shockwave77598.livejournal.com]

I have a simpler answer. Everytime a house loan got made, the banks got money. So they made riskier and riskier investments to keep the quarterly numbers up, thinking real estate prices would never go up. At the same time though, wages were flat or falling, and finally people couldn't afford housing anymore - period. Thus the housing bubble burst and the banks were left holding properties worth less than they paid.

The sharks created a feeding frenzy and then look all dazed that there's nothing left to eat. I say let the banks collapse and sell the properties they have at a quarter on the dollar to other banks which weren't so dazzled by short term numbers that they did long term damage to their company to get them. They wanted a "no govt. interference" world and they got it. Asking for a govt. bailout for their ignorance is the height of hypocrisy in my book, especially when all their CEOs have 100M$ mansions in the Hamptons.

[shockwave77598.livejournal.com]

down - real estate would never go down...

[drzarron.livejournal.com]

Well, that's in essence what that article said, but he points out several much more meaningful factors too.. its an excellent article

[whitefeet.livejournal.com]

The real issue with that analysis is that, due to securitization, it wasn't just the banks that made the loans that were left holding them at the end of the day.

[giza.livejournal.com]

My mutual funds agree. :-(

[whitefeet.livejournal.com]

Pretty good article, restates what I've been seeing for a good while now.

This past week was a pretty exciting time (in my opinion)

[rassah.livejournal.com]

Great thing about all of this is that it's once again a really good time to invest. Right now is probably the best time to buy into the market. Stuff is so cheap ^.^

[wildw0lf.livejournal.com]

Very easy to read, and to the point. What I don't understand though is exactly how it's possible to lose that much money. And it's too bad that in the second round of the bailout package bill, that Congress passed it because they were scared. The bailout bill doesn't do anything to stop the rising tide of foreclosures.