Everand Logo

Welcome to Everand!

  • Discover millions of ebooks, audiobooks, and so much more with a free trial

    Only $11.99/month after trial. Cancel anytime.

    The Great Recession: The burst of the property bubble and the excesses of speculation
    The Great Recession: The burst of the property bubble and the excesses of speculation
    The Great Recession: The burst of the property bubble and the excesses of speculation
    Ebook39 pages32 minutes

    The Great Recession: The burst of the property bubble and the excesses of speculation

    By 50minutes

    ()

    Read preview

    About this ebook

    Understand the Great Recession in no time! Find out everything you need to know about this key moment in contemporary economic history with this practical and accessible guide.

    The burst of the property bubble in the USA in 2008 saw millions of families evicted from their homes and soon led to a major worldwide economic crisis. The spread of the crisis and the presence of toxic assets in banks around the world laid bare the complex mechanisms used by financial institutions to avoid taking responsibility for risky assets and the arrogance of the largest banks, who saw themselves as “too big to fail”. In spite of large-scale efforts to mitigate the effects of the crisis, its consequences are still felt today.

    In 50 minutes you will be able to:
    • Identify the key causes of the recession, including the widespread use of securitization
    • Understand how the crisis unfolded and spread around the world
    • Evaluate the measures taken by national governments to mitigate its effects

    ABOUT 50MINUTES.COM | ECONOMIC CULTURE 
    The Economic Culture series from the 50Minutes collection provides the tools to quickly understand the main theories and concepts that shape the economic world of today. Our publications will give you elements of theory, definitions of key terms and case studies in a clear and easily digestible format, making them the ideal starting point for readers looking to develop their skills and expertise.
    LanguageEnglish
    Publisher50Minutes.com
    Release dateFeb 7, 2018
    ISBN9782808007030
    The Great Recession: The burst of the property bubble and the excesses of speculation

    Read more from 50minutes

    Related to The Great Recession

    Titles in the series (8)

    View More
    View More

    Related ebooks

    Banks & Banking For You

    View More
    View More

    Related podcast episodes

    Related articles

    • Article

      Bond Challenges

      Oct 13, 2023

      Bond Challenges
      4 min read

    • Article

      Financial Knowledge Is Power Only If You Apply It

      Mar 6, 2021

      ONE of my favourite sayings is “Financial literacy, just like weight loss, isn’t dependent on one thing. It’s 20% education and 80% your action.” A year into the Covid-19 pandemic, I’m reminded of a young woman I interacted with a few months before S

      3 min read

    • Article

      Embrace The Black Swans

      Sep 29, 2021

      Back in 2007 I was given a book called The Black Swan by Nassim Nicholas Taleb. At that time the concept of black swans was rarely talked about: those random events that underlie our lives, ranging from world disasters to great advances. Their impact

      3 min read

    • Article

      The Looming Bank Collapse

      Jun 10, 2020

      The Looming Bank Collapse
      14 min read

    • Article

      $1.2 Trillion In Risky Corporate Debt Echoes Subprime Mortgage Crisis

      Jan 20, 2019

      WASHINGTON –– Indebted borrowers increasingly take out high-interest, adjustable-rate loans that are packaged into securities and sold to investors eager for a better rate of return. Everything's fine while the economy is growing. But when it slows,

      7 min read

    • Article

      How Might Archegos’ $10 Billion in Losses Affect Your Retirement?

      Apr 29, 2021

      Imagine you walked into a Las Vegas casino and you brought all the money you had, let’s say $1  million, and the casino gave you $154 million to gamble with. How smart do you think that would be for that casino?  Well, right now Goldman Sachs Bank US

      6 min read

    • Article

      How Lehman's Collapse 15 Years Ago Changed The U.S. Mortgage Industry

      Sep 15, 2023

      The global financial crisis of 2008 ushered in a new era of consumer protection, but the future of the housing market is uncertain.

      3 min read

    • Article

      What You Need to Know About the Shadow Banking System Now

      Jun 21, 2019

      The term "shadow banking" often elicits thoughts of shady back-alley dealings and loan sharks waiting to take drastic measures against debtors who can't pay. While that makes for an interesting story, it couldn't be further from the truth. Most cons

      6 min read

    • Article

      Why Banks Keep Failing

      Apr 30, 2023

      Why Banks Keep Failing
      5 min read

    • Article

      Bank-Loan Funds Are in a Sweet Spot

      Jun 24, 2021

      As interest rates fell in 2019 and 2020, investors paid bank loans little attention. But an economic recovery and the likelihood of rising short-term interest rates are prime conditions for these loans, which pay an interest rate that adjusts every f

      1 min read

    • Article

      Will The FDIC's Move To Cover Uninsured Deposits Set A Risky Precedent?

      Mar 14, 2023

      Some say the decision to guarantee deposits beyond the typical $250,000 limit was necessary to keep the financial system stable. Others argue this sets a bad precedent if other banks run into trouble.

      3 min read

    • Article

      I Wish I Knew What A CDO Was, But I’m Too Embarrassed To Ask

      Feb 4, 2022

      A collateralised debt obligation (CDO) is a type of financial product – a credit derivative – which is backed by an underlying pool of loans. An investment bank pulls together mortgages, bonds, car loans, or any other type of debt, bundles them all u

      1 min read

    • Article

      India Inc’s Rising Cost of External Capital

      Jun 25, 2020

      India needs external capital to grow. This has been true since the early years of Central planning following independence when India relied on external debt raised mostly by its Central and state governments from foreign governments and multilateral

      6 min read

    • Article

      After Bank Failures, Raising Deposit Insurance Has Benefits – And Risks

      May 1, 2023

      Sue Hackney had heard the news, of course. When reports surfaced in March that First Republic Bank might be in trouble, the Boston-area marketing professional and her husband debated whether to pull their money out. But “their customer service is so

      4 min read

    • Article

      All In The Family

      Feb 26, 2020

      Should you borrow from the bank of mum and dad? Most people would advise against it unless you’re willing to take the risk of having a major falling-out with your parents. The good news is that some banks are now developing products that can help you

      2 min read

    • Article

      Buying Corporate Debt

      Mar 24, 2020

      Buying Corporate Debt
      3 min read

    • Article

      The Era of Easy Money Is Over. That’s a Good Thing.

      Dec 11, 2023

      When inflation started to spike in 2022, the Federal Reserve made the only move it could: raising interest rates. Over the course of 18 months, rates shot from near zero to above 5 percent and have remained there since. Now inflation appears under co

      6 min read

    • Article

      Junk Bond Funds Don't Belong in Long-Term Portfolios

      Mar 5, 2019

      I recently met with a woman who came to me for advice on her existing portfolio. She had been investing for a while but was concerned her portfolio would not weather another market downturn. As she was close to retirement, she wanted to be reassured

      4 min read

    • Article

      The Best Trades In History: Betting On A Bailout

      Sep 9, 2022

      Bill Gross (pictured) was born in Middletown, Ohio, in 1944, and graduated from Duke University in North Carolina. After reading a book on card counting he spent a summer in Las Vegas, making $10,000 on blackjack before spending three years in the Na

      1 min read

    Related categories

    Reviews for The Great Recession

    0 ratings

    0 ratings0 reviews

    What did you think?

    Tap to rate

    Review must be at least 10 words

      Book preview

      The Great Recession - 50minutes

      The burst of the property bubble and the excesses of speculation

      When: 2007-2009.

      Where: the crisis began in the USA, before spreading around the world.

      Context: when a speculative housing bubble in the USA burst, many homeowners ended up defaulting on their mortgage payments. Subsequently, a high-risk loans mechanism, through which lenders used securitization to transfer their responsibility to other financial organisations, came to light.

      Key protagonists:

      The government-sponsored organisations the Federal National Mortgage Association (FNMA, known colloquially as Fannie Mae) and the Federal Home Loan Mortgage Corporation (FHLMC, known colloquially as Freddy Mac).

      The major American merchant banks and insurance companies Goldman Sachs, AIG, Lehman Brothers, Morgan Stanley and JPMorgan Chase.

      Michael Burry (American physician and hedge fund manager, born in 1971) and Steve Eisman (American investor, born in 1962), who were among the first investors to foresee the impending subprime mortgage crisis.

      Key terms:

      Securitization: a mechanism introduced in the 1990s which allows banks to sell on the loans they have given out in the form of securities.

      Subprime loan: a type of loan in the US which involves lending to borrowers who may struggle to pay back the money, in order to purchase property or other goods.

      In 2008, the world saw another side to America: when the property bubble burst and the financial crisis hit the country, onlookers learnt of financial practices that left thousands of American households homeless, emptied whole neighbourhoods of

      Enjoying the preview?
      Page 1 of 1