Posted by: Armel | December 28, 2008

2008:LOOKING BACK at the FINANCIAL CRISIS

2008-financial-crisis

Looking back at the reckoning of the Financial stress on all economies in 08, we’ll have to remember that the causes are not all linked to the subprime mortgage industry failures.

Marc Handler of the NYT puts it to light: ” By itself, money from China is not a bad thing. In the 19th century, the United States built its railroads with capital borrowed from the British.

But Americans did not use the lower cost money afforded by the Chinese investment to build a 21st century equivalent of the railroads. Instead, the government engaged in a costly war in Iraq, and consumers used loose credit to buy sport utility vehicles and larger homes. Banks and investors, eagerly seeking higher interest rates in this easy-money environment, created risky new securities like collateralized debt obligations”

I think it’s clearly how we got here; although it went even further as those securities found hungry buyers all over the world, that risk then traveled along and spread like a virus.

Armel Njeunou

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Responses

  1. Good Riddance 2008 !
    That was a very bad year.
    Want to know what else? They just announced the total bonus pool and by the time it comes down to our unit they won’t be anything left !

    I’m over it !

  2. Why are you getting mad this late in the season? The writing was on the wall about the bonus pool since November pete!
    Smaller boutiques firms are not doing that bad. (I’m just saying)


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