Tuesday, September 16, 2008

The Banking Mess Brought On By Greed

As usual, Atrios has the best and most concise summary of what the hell went wrong:

Through this crisis, there's this underlying narrative that something can be done, that there's just a wee liquidity problem. But underlying all of this is the fact that banks made a bunch of stupid loans which aren't being repaid. A bunch of people made highly leveraged investments in securities backed by those loans. A bunch of other people sold insurance on those securities and related debt.

Lots of money is being lost and there isn't any way to fix that.

It's not quite money in the mattress time, but it's not that far away. Next up: AIG, WaMu and who knows what else.

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