Video | Inside Job The Movie | The Market Crash of 2008

The crash of 2008 put America’s economy in a very bad situation. Take a look at why it all happened, who was responsible, and the unethical behavior of Wall Street Financial Institutions. A market crash that many believed America would never recover from. This documentary contains interviews with people and companies that were directly involved with the crash. It’s interesting to note that this video alleges that many of the financial institutions knew exactly what the consequences would be for their actions. Yet they were not held accountable for the losses many Americans suffered.

I was trading the markets during this time, and had the foresight to know that something was not right about the market. Loose lending practices by the banks, had caused a housing bubble that was not sustainable. It was odd to observe, that those who could not typically afford a home were now buying houses. Sometimes they even bought two or three homes as they started to speculate in the real estate market. After taking a closer look at how this was possible, I discovered that the loans they obtained were cleverly engineered to make it possible.

I’d like to first note that banks do not typically give loans to individuals that have a high probability of defaulting. This poses a huge amount of risk for the bank. So who is crazy enough to take on that risk? Wall Street! Once I figured this out, I knew the economy was in trouble. The Wall Street boys as usual, were up to no good. Essentially how this works, the mortgages were packaged so they can be sold on the open market to whomever wanted to take the risk. The risk takers who bought the loans were institution, private investment groups. It didn’t stop there. Institutions from all over the world wanted a piece of the action. Other countries bought these loans as well. Everyone was making money. At some point I figured this would end, when demand exceeds supply, prices come crashing down.

 

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