Ten years ago, US advance coffer Lehman Brothers filed for bankruptcy, appearance the best allegorical moment of the all-around banking crisis. It charcoal the better defalcation filing in US history.
The annihilation of Lehman on 15 September 2008 was aloof the tip of the iceberg. Little did we apperceive but at the time the accomplished all-around banking arrangement was on the border of collapse.
The basal account was the declining US apartment market, in accurate the subprime mortgage sector, which lent to borrowers with poor acclaim histories.
These subprime mortgages were repackaged forth with acceptable mortgages and awash to investors. Convinced that the accident had been spread, Lehman, amid abounding added advance banks, invested in them.
Unfortunately the apartment bazaar began to abatement and those repackaged mortgage investments became toxic. No one knew who captivated the bad debts and so banks became alert about lending.
What happened next, few will forget. The apple stood on the precipice. Abandoned aberrant accomplishments by policymakers and axial banks prevented a breakdown of the all-around banking system.
Read more: The adventure of the all-around banking crisis explained in six charts
Did we apprentice the assignment on debt?
While the agitator for the crisis was the atrophy of the US apartment market, the basis account was accessible admission to bargain money. Encouraged by
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