In pictures. Make sure you click on the picture to launch the slideshow.
(thanks to a reader for sending that in)
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[…] Don’t balk at the fact there are 45 slides. It’s worth it. Posted by Jim Henley @ 7:49 am, Filed under: Main « « Totally Testing | Main| […]
Xoebe
While a bit heavy on technical details, yeah that sums it up.
I feel sorry for the idiot homebuyers – not their fault they are idiots and they trusted a bunch of crooks. I feel sorry for the secondary mortgage backed securities who got lied to (yeah! these are the same securities you’ve been buying since 1975) who totally got screwed.
Ironic. The crooks who lied and stole all the money are the ones who are *not* left holding the bag. Wait – didn’t you say something yesterday about “privatize the profits, socialize the costs” ?
That pretty well sums it up.
On another, older tangent, that was the basic idea behind energy deregulation in California. “Let’s screw Edison, Edison defaults, the state steps in to cover the costs, and we get the money! It’s what we call a win-win-win!”
What a shame.
rawshark
All you have to do is say the lefts plan is communist or the most liberal thing in the world, you don’t have to explain or detail what the rights plan is. Wingnuts are children and left wing policies are put to them as the boogeyman is put to them. Or maybe they are farm animals and…..
Fe E
That’s a helluva good presentation–especially the back and forth with the Norwegian Villager!
Dennis - SGMM
That slide show is an elegant, comprehensible explanation of just how the sub-prime mess came to be. I’d bet anyone here a good lunch that our current president wouldn’t understand it.
“Wha’? The economy’s strong!”
pharniel
seriously. full of win.
Alan
If only the slideshow included the law Democrats passed forcing lenders to relax restrictions thus enabling these loans. After all, Rush Limbaugh told me the Dems caused this to happen. The only thing the Republicans did was make it harder to declare bankruptcy. That wouldn’t cause lenders to relax caution, would it?
The Other Steve
It was Bill Clinton’s fault.
The Other Steve
I actually work for Really Smart Company. you know the rules have changed, right?
Alan
Honestly, I would love to know what rules changed and why. And who was behind the changes.
Mr Furious
No, no no. These days everything is Nancy Pelosi’s fault.
The Other Steve
It’s like the internet super bubble. The rules of business have changed!
We can give mortgages to people who can’t afford to pay it back, and make up the profits through volume!
Mike
And everybody has a share!
Chris Johnson
oh MAN. “Tell them you fucked up.” ROFL
gypsy howell
The Animal House Defense! You fucked up – you trusted us.
binzinerator
Bwaha! That was good.
You beat me to it, Mike! I was listening to the radio last week to some financial guy describing the subprime collapse, and I couldn’t help saying aloud in the pause at the end of his sentences “..And everyone has a share!”
And somehow, this also reminds me of this from Husker Du:
ThatLeftTurnInABQ
Time for a (sick) subprime joke:
What is the difference between the Discovery Channel show “Life After People” and the commercial real estate market in Sacramento, CA?
answer: One of them is on the TeeVee.
h/t: CalculatedRisk
jcricket
This is a really good analogy. We all just looked the other way while seemingly smart people were telling us to ignore 100+ years of business acumen in favor of a hockey-stick graph and the good PR skills of some entrepreneurs.
The same thing is happening right now. Lots of the web 2.0 companies are worth nowhere near the valuations they’re getting. They’re certainly not as silly as the crop of businesses from last time around, but their probably over-valued by an order of magnitude.
At least the actual money invested and number of people employed is 1/10th of what it was last time around, so if the bubble “pops” far fewer people and 401ks are impacted. The main people that lose are the risk takers (VC/angels, startup employees), as it should be.
I think the unwinding of the RE bubble isn’t going to be nearly as bad as the doomsayers make it out. Sure, if you’re in a directly impacted industry you might get hosed, but it’ll be temporary. With the coming influx of immigrants and population growth predictions, construction will pick back up in a couple of years. Banking’s not going away. Securitizing/packaging loans isn’t going away. Hopefully some people just come off a bit smarter.
And like last time around, it’ll be a bumpy ride for a while, but assuming it’s not a full-blown-global-depression, most people will just ride it out and come out the other side not to much worse for the wear.
I’m sympathetic to the whole “we’ve been delaying the inevitable correction forever, it’s gonna be brutal us when it happens” philosophy. But history has proven things are rarely as bad as the bears would have you think (just like they’re rarely as good as the bulls predict).