That is the most complete explanation I have seen.

yeah, even though its highly simplified, it hits all the important points, the stuff that really screwed the pooch. i do wish it had put a little more emphasis on the fact that the reason it all happened is because everyone up and down the line didnt care what happened to the next guy because once they handed it off, they got paid and it was out of their hands, and they were off the hook for it.

this means the mortgage brokers and lenders didnt give a shit if you wanted to buy a million dollar house on $30k a year. and thanks to that ridiculous "tranched" investment the CDO, they were able to get this toxic paper rated as triple-A... if you ask me, while everyone in the pipe is responsible, its the ratings companies that deserve the biggest kick in the ass for flat-out lying about the quality of the CDO paper. if they hadnt been able to sell the CDOs, then the whole "give a mortgage to anyone who can breathe" bullshit would have stopped because the lenders would have been stuck holding the bag on those bad notes.

i think its important to note that LEVERAGE lies at the heart of this current crisis, just as it did in the great depression. will wall street never fucking learn?

That was brilliant. Thanks.

And it makes me think that this sort of thing is inevitable, every so often, in a capitalistic society. If everyone is focused on their own good, eventually that short term/personal focus will bite them in the ass... but that's still the best motivation I know of for improvements to all products and services (better, faster, cheaper).

In a sense, perhaps the whole slavery > Civil War thing could be seen in light of destruction of investments (slaves were expensive, and the typical southern farmer/banker had a lot more invested in his slaves than his house).

Maybe every century, this happens, and each time we get a little smarter, and cull the weak.

Just a thought.