Over 15 years after the most serious crisis since the Great Depression, we still do not understand what caused the Housing Bubble that led to the Great Financial Crisis. Many have pointed to deregulation, but have failed to show how a gradual trend of deregulation could have caused either the sudden spurt in housing prices that marked the onset of the Bubble or the discrete turning points thereafter. Others have pointed fingers at the Fed, but have yet to explain why the Bubble began prior to the Fed’s easy money policies or why prior periods of easy money didn’t also lead to housing bubbles. Still others have blamed Fannie and Freddie, but have failed to explain why so much of the financing that fueled the Bubble also came from major commercial and investment banks.
What Really Happened – The Great Financial Crisis of 2008 presents concise but comprehensive original research that shows what spawned the Housing Bubble, why it grew to such dangerous proportions, and how this created the potential for a panic. The book then details the missteps that triggered the Panic, what caused the financial markets to seize up, and the specific responses that finally returned the markets to equilibrium. In addition to debunking numerous myths, the book also exposes the history behind the people and institutions involved and sets forth measures to help investors, executives, directors, regulators and policy makers avoid a repeat of the mistakes that led to the worst crisis in nearly a century.
