Debt, debt, debt

From twitter fans, I learned about this incredibly informative blog entry by James Quinn, "The Great Consumer Crash of 2009." It's long but definitely worth a read. Scroll down to check out the graphs he included that provide valuable visuals that reveal what's happening.

Visual aid on financial crisis...

Confused about the bailouts and bad mortgages, Freddie Mac and Fannie Mae, subprime whatchamacllits? Check out this handy flow chart covering events from 2003 to present.

If you're like most people, you don't really know what's going on with the economy. You know there's something to do with loans and payments and what not, but not much else. [See this] "visual guide to the financial crisis" - or a flow chart, rather - to clear up some of those cloudy details. It goes back to 2003 after the dot-com crash up to the recent government bailout.

James posted a thoughtful response with more info:

The above poster is a good start, but . . . it fails to back up to the late 90’s when Freddie Mac and Fannie Mae are mandated to loosen lending standards for the “common good.” (not to mention free get out jail passes from Congress) Enter the era of “sub-prime” lending.

This is, I believe, one of THE keys to fully understand the role policies the government has played. Of course, they don’t want you to know.

It also glosses over the significant role derivatives and transaction based business models played. Some of those were employed to prop up Wall Street post-9/11. Decent intentions, bad implementation and outcome. Greenspan recently admitted to underestimating that individual greed could undermine “bank’s self regulation.”

This collapse and bailout is a bailout of a failed bet on mandating sub-prime lending and their over-reaching into private lending (Freddie and Fannie). We’re left with the mess.