On Thursday, Sept. 18, 2008, the astonished leadership of the US Congress was told in a private session by the chairman of the Federal Reserve that the American economy was in grave danger of a complete meltdown within a matter of days. “There was literally a pause in that room where the oxygen left,” says Sen. Christopher Dodd (D-Conn.). As the housing bubble burst and trillions of dollars’ worth of toxic mortgages began to go bad in 2007, fear spread through the massive firms that form the heart of Wall Street. By the spring of 2008, burdened by billions of dollars of bad mortgages, the investment bank Bear Stearns was the subject of rumors that it would soon fail. “Rumors are such that they can just plain put you out of business,” Bear Stearns’ former CEO Alan “Ace” Greenberg tells FRONTLINE. The company’s stock had dropped from $171 to $57 a share, and it was hours from declaring bankruptcy. Federal Reserve Chairman Ben Bernanke acted. “It was clear that this had to be contained. There was no doubt in his mind,” says Bernanke’s colleague, economist Mark Gertler. Bernanke, a former economics professor from Princeton, specialized in studying the Great Depression. “He more than anybody else appreciated what would happen if it got out of control,” Gertler explains. To stabilize the markets, Bernanke engineered a shotgun marriage between Bear Sterns and the commercial bank JPMorgan, with a promise that the federal government would use $30 billion to cover Bear Stearns …
Comments 25
@riddler03 what? you never heard of the “community reinvestment act”?
Posted 24 Aug 2010 at 7:46 pm ¶@inkey2
Posted 24 Aug 2010 at 8:37 pm ¶I’m getting sick of that idiotic argument about how the banks were forced to lend to people. The mortgage market at its peak was about $13.5 Trillion and yet the banks created tens of trillions of dollars of synthetic CDOs cause they couldn’t get enough of mortgage backed securities. But you wouldn’t know that you stupid fucking inbred. People like you need to die.
@Tofi684 I hope your having fun living in a country thats not America. Whats it like living literally in an asshole?
Posted 24 Aug 2010 at 9:36 pm ¶@youngrstandard Its not your governments fault and its not the American peoples fault. The fault lies with world wide greedy bankers. If they just used depositors money and did due dilligence they wouldn’t have lent to stupid businesses with ridiculous debts paying ridiculous money for other businesses.
Posted 24 Aug 2010 at 9:38 pm ¶The bubble was always gonna burst.
Where govs worldwide are making a mistake is giving the banks a shed load of cash and saying go ahead and do it all again.
Were all up s$£t creek : (
@Tofi684 you shouldn’t be laughing at Americans for what’s happening! Whats happening to America can affect the world in a bad way. Were not bitches! Blame the government, not the American people! Alot of American people are more innocent in this whole mess!
Posted 24 Aug 2010 at 10:32 pm ¶@inkey2 actually the repealation of the Glass-Steagal act never forced banks to lend to unqualified homebuyers, instead it made it easier for banks to do so.
Posted 24 Aug 2010 at 11:13 pm ¶its americas turn to suffer…hahahahahahahahahahahahahahahahahahahahaha…how does it feel bitches! what goes around comes around…did u really think you are going to get away from being collapsed? i hope u will fall like the ussr…lol to americanos
Posted 24 Aug 2010 at 11:44 pm ¶I bet Barney liked getting mortgages.
Posted 25 Aug 2010 at 12:22 am ¶Tim is in Goldman group
Posted 25 Aug 2010 at 12:27 am ¶Had Bill Clinton not repealed the Glass-Steagall Act in Nov 1999, this type of speculation within the financial community would have not happened. I refuse to believe that in 1933 when this was made law, that in 1999 when this was repealed, that no one knew the collapse was inevitable.
Posted 25 Aug 2010 at 1:17 am ¶Real Money = Gold Standard
Posted 25 Aug 2010 at 1:55 am ¶I doubt these aren’t repeating right now especially in influencial Asian markets. Indeed, I believe some new players are copying it to observe where are other back doors to opt out safely because these bubbles are easy and quick. CDSes are still snowballing because they are still an very effective black mail tools that big accounts can take turn using them.
Posted 25 Aug 2010 at 1:56 am ¶Zionist Bankers need to be Weeded out of our Government! The Federal Reserve Needs to be Shut Down! Zionist CFR Bankers need to be taken out of our Media, Zionist profiteers of War that are in our Government need to be weeded out of our Government! The Zionist Lobbiest Groups need to be Barred from Government access and Influence! Wake Up America! Dont take the Shot!
Posted 25 Aug 2010 at 2:27 am ¶inkey2… You have Stockholm Syndrome.
Posted 25 Aug 2010 at 3:24 am ¶If we NATIONALIZE THE MONEY SUPPLY all the derived fakery couldn’t happen.
FAKE MONEY = FAKE SECURITIES
Real Money = Stable Securities
The central banks are mainly privately owned and create unlimited unaudited currency out of thin air. We used to use mONEY (a note secured against intrinsic value eg silver as in £sterling); now we use DEBT NOTES (a borrowed piece of paper worth nothing and accruing compound interest forever to its issuer): the CURRENCY WE USE IS NOT MONEY.
Posted 25 Aug 2010 at 4:12 am ¶Yep; the dynastic shadowy families that own our money supply (central banks) can secretly empower themselves to buy anything they want: corporations institutions governments armies cultures media science education nations continents anything their hearts desire; while the debt notes they issue to us that we mistake for money continually rot.
Fake derivatives is just one of the many skins they use to hide the effects of the fake money.
Posted 25 Aug 2010 at 4:17 am ¶It only took 3 percent defaults to cause the whole house of cards to crash down
Posted 25 Aug 2010 at 4:36 am ¶The CRA was started under Carter.
Posted 25 Aug 2010 at 5:00 am ¶16 years ago I purchased my condo…..I had no debt….plenty of cash in the bank and a job I had for 20 years…..and the mortgage company made me do everything but a urine test to get my mortgage. They put me through total hell and scrutinized every financial move I made for the last 10 years. Wow…did things change
Posted 25 Aug 2010 at 5:42 am ¶you can thank the democrats for forcing banks to lend money to unqualified home buyers
Posted 25 Aug 2010 at 6:09 am ¶to pk421: what??? LOL…jimmy carter? Don’t you mean Bill Clinton????
Posted 25 Aug 2010 at 6:10 am ¶hahahahahahah fucking american scum!!!!!!!!!!!!! fucking loser shit country
Posted 25 Aug 2010 at 6:34 am ¶Let me add this…
I picked on FOX, but none of the major cable news channels are worth much.
Fox IS downright propaganda. But CNN is nothing more then a distraction. And MSNBC does nothing but sit around and laugh at Republicans acting like Klingons.
And while Countdown with Kieth Olbermann might make me laugh, my entertainment does not inform me.
Google is the best news channel. Google.
I serf the web much more than I watch TV… And I have a 19″ HDTV sitting on my computer desk…
Posted 25 Aug 2010 at 7:10 am ¶I give you A LOT of credit for seeking out the details to a question you had. Most, are too proud to change course once when they have formed an opinion.
You gained my respect for posting here with the correction.
I’m not trying to be patronizing at all. Im serious as a heart attack.
The Fox News comment was a bit reactionary. I must appologise for being reactionary, when I’m giving you respect for not being reactionary.
Was simply saying, “Don’t count on Hannity to be honest with you.”
Posted 25 Aug 2010 at 8:09 am ¶and after looking into it some more, I was wrong. CRA was not a major contributing factor to the subprime crisis.
Posted 25 Aug 2010 at 8:46 am ¶Post a Comment
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