-
Period: to
1995
-
Glass Steagall
This act allowed the banks to four provisions of the U.S. Banking Act of 1933 that limited commercial bank securities activities and affiliations between commercial banks and securities firms. It is also known as the Banking Act -
Rises in the Homeless people
There are rises in the homeless people in America it went drom 4 percent in 2003 to 4.6 % in 2006 this is because many people lost their homes from forclosures . This bubble of people that lost their money was now refinancing their homes to the extent that they cannot pay it back -
Sub Prime Mortgages
Many sub prime mortgages were given out o people that they could not afford so they could not pay back the company that gave them the money so that buisness goes under, this is also known as toxic mortgages. -
Bear Stearns Collapse
Bear Stearns request money from federal reserve because he has lost it due to people not paying back their loans so he goes under. Then the federal Reserve bails him out so that people would not panic, although this made people think that the government would bail them out if they fail -
Other Banks Follow
Other banks suc as Fannie Mae and Freddie Mac follow in their foot steps for get in bail out money for the money that the lost from giving out sub prime loans so Paulson has to help them out with their payments. -
Lehman Brothers Crash
The Lehman brothers crash and their bank goes bankrupt, they took out to many loans on houses woth people that could not afford them so they were out of money. In 2007 they lost there leader in funding so many people got laid off, after that one year later the bank goes under. -
Grave Danger
The Federal reserve( Biggest bank owned by the government) states that the American Economy is in grave danger and that they need to do something other wise the econonomy would collapse -
Henry Paulsons Speech
Henry PAulson stated in his speech that he will not be bailing out other banks and that the U.S should assume the role of the moral hazard that states that the bank should not pay for thte mistakes that the banks made. -
Stock Market Crash
One day after the banks were bailed out the stock market crashed and the U.S hit the depression. this did not just affect the car loans, house insurance, small buisnesses, ect. This was the most tragic thing to happen to the U.S economy -
Emergency Economic Stablization Act
This was an act that was made to bail out companies that failed, it gave companies 700 bililion dollars to pay off the mortgage payments that they gave to people
