For those interested in these sorts of things (and really, even for those who aren't), I really think that you should spend 2 hours of your time and listen to these two shows on my favorite radio program This American Life. They are definitely worth your time. You will come away with a much deeper understanding of the financial crisis, delivered in an easy-to-understand-an-extremely-complex issue kind of way.
The Giant Pool of Money
and the follow-up:
Another Frightening Show About the Economy
If you've heard these, or after you listen to them, post here with your comments & thoughts... I have lots of my own that I will post separately if they don't come out here.
2 comments:
Both of these programs are excellent.
Beside the size of the credit default swap market ($60 Trillion), I was struck by the thin line between investing and gambling. It is easy to point fingers at rich CEOs and financial wiz kids (and we should - they have betrayed the public trust), I also think we need to take a hard look at our own lives and how much we depend on credit and how little we save.
I admit that I was totally stunned by the program -- I had heard of "credit default swaps" but didn't have a good handle on what they actually were. To hear that how completely unregulated they were was astonishing, especially since they functioned as insurance!!! With no capital reserves to back them up!!! Unreal.
We definitely need to look at ourselves for this -- we have been living outside of our means as Americans. Credit has been so easy to come by and has been fueling our economic growth, which has created an economy with its roots in sand...
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