Given the topic- credit crisis, main street vs wall street, sub prime mortgages etc., I thought that I would post it here as well for all my readers here who do not follow my other blog. If you follow both blogs, I apologize for the repetition:
If you have been confused by the Credit Crisis, what it means, what is has to do with the average person, what CDOs are, what leverage did etc. then this is the answer for you.
Watch this video in two parts:
The Crisis of Credit Visualized: Part 1
The Crisis of Credit Visualized: Part 2
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2 comments:
Deika
Nicely done. I am no expert on this stuff, but I though one problem was that the sub-prime mortgages were rigged against the borrower with low initial payments that then balloon. The video maves the borrower to be one of the bandits when I am not sure that that is necessarily the case, although obviously, many were
If I'm not mistaken, they can prove both predatory lending and "irresponsible borrower behavior". Which means, yes some banks picked on people. And yes, some people bought houses they could not afford, and knew what was happening and engaged in borrowing anyway - many of those people had no intention of living in the houses and so walked away.
It is also very true that LOTS of people are innocent bystanders in this mess, and are seeing their property values plunge, or are trying to make their mortgages which literally ballooned beyond expectations because of the degree of interest rate hike, and also became unaffordable with wage cuts, pay freezes, unemployment, and lack of access to credit.
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