Financial Crisis 101

For a long time I felt that the general public - consumers - are kept out of the loop of this financial crisis we are supposedly in.

How about your home mortgage, how about buying that car with a loan.... Cardiac arrest of the entire system... Better think twice?

Two great films:

Inside Job (2010)



Inside Job provides a comprehensive analysis of the global financial crisis of 2008, which at a cost over $20 trillion, caused millions of people to lose their jobs and homes in the worst recession since the Great Depression, and nearly resulted in a global financial collapse. Through exhaustive research and extensive interviews with key financial insiders, politicians, journalists, and academics, the film traces the rise of a rogue industry which has corrupted politics, regulation, and academia. It was made on location in the United States, Iceland, England, France, Singapore, and China.

Too Big To Fall (2011)



A close look behind the scenes, between late March and mid-October, 2008: we follow Richard Fuld's benighted attempt to save Lehman Brothers; conversations among Hank Paulson (the Secretary of the Treasury), Ben Bernanke (chair of the Federal Reserve), and Tim Geithner (president of the New York Fed) as they seek a private solution for Lehman's; and, back-channel negotiations among Paulson, Warren Buffet, investment bankers, a British regulator, and members of Congress as almost all work to save the U.S. economy. By the end, with the no-strings bailout arranged, modest confidence restored on Wall Street, and a meltdown averted, Paulson wonders if banks will lend.

And how did Japan somehow manage to not get embroiled in this massive US financial crisis?

Comments

Anonymous said…
Hi Kurashi,

And how did Japan somehow manage to not get embroiled in this massive US financial crisis?

Of course there are many different answers to this question, but two big ones are 1. At the time the Japanese financial sector didn't own a bunch of American made toxic assets, and 2. Japanese industries were sheltered by a host of regulations and collusion among companies.

That being said, I don't think Japan isn't a part of the "new normal", which is worldwide money-and-power grab while a majority get marginalized.

ken
adams guild™
Martin J Frid said…
Ken,

Thanks for the comment and the answers. I remember there was a NHK documentary stating that some Japanese pension fund actually went to Wall Street and asked for data about the "sub-prime" loans, and when they looked and found out that there was just piles and piles of documents that noone seemed to know much about, they pulled out of their investment.

The "new normal" is another beast, though.

Kurashi™

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