Here’s a funny 45 page slide show that explains how we got into the current financial crisis over sub-prime loans.
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You done good. Funny AND informative!
Interesting slides. FYI there is something screwy with slides 42-44, the Next links aren’t working correctly for me.
You (and every other commentator) forgot the next frame where the consumer says, “Really? That doesn’t seem right and I’m not going to be led blindly into the biggest financial decision of my life so I’m going to check into that.” Oh wait - its because that never happened.
Worst. Drawn. Comic. Ever.
Plus that loan broker was getting massive kick backs for all the loans he gave because the bank would sell them in bundled securities basically putting tons and tons of thirty year loans right on the companies bottom line and not waiting the 30 years for the customer to pay, if they even could pay.
The sub-prime mess is REALLY a mess, isn’t it? Unfortunately, the sub-prime mess is one variable out of many: high oil prices, astronomical cost of wheat and soy and grain, and of course the housing crisis. Does anybody honestly know when this will be over? Do you think we’re in a TRUE recession at this time? Warren Buffet thinks so…
It’s interesting, and very informative, but also not complete. The bigger issue than the direct tranching was the use of default swaps. Basically, one company buys the *actual* CDO, which will vary in return rate, in exchange for a set rate of return (based, usually on LIBOR). Thus, even safe debt (like corporate debt) becomes risky based on fluctuations in the market. It wasn’t (and isn’t) all about the sale of sub-prime mortgages
…if only it weren’t true…
I’m a old mortgage guy and you don’t know how true that is. every lender that I dealt with encouraged me to take advantage of the lax program guidelines while they were available. 100% loan no worries, little credit no worries, little job stability no worries, they can do it all!!! yeah ok
The writer forgot the part about how Congress mandated that lenders offer crappy loans to shitty borrowers so they (the Democratic Party “base”) could all be a part of the American Dream of home ownership.
Um, have you ever thought you are over-simplifying things? My guess - no. And guess what - people other than just those that got sub-prime mortgages are hurting too.
that is witty and very informative