Lehman Brothers was headed for bankruptcy. ibid.
Paulson had bet the markets would take care of themselves; he would soon discover he was wrong. ibid.
Paulson received the money – $700 billion known as TARP – Troubled Asset Relief Program. ibid.
Paulson gave each man a single piece of paper spelling out the conditions. ibid.
In one day everything had changed. ibid.
The marriage between Bank of America and Merrill Lynch was already showing signs of strain. ibid.
Merrill’s toxic assets were eating a hole in the balance sheet. ibid.
Long before the economic meltdown the story of one woman who tried to warn about the threat to the financial system. Before the toxic assets poisoned the economy, she warned of their danger ... Alan Greenspan v Brooksley Born and the Warning. Frontline: The Warning, PBS 2009
Reagan made Greenspan the most powerful banker in the world – the chairman of the Federal Reserve. ibid.
In 1993 Bankers’ Trust, one of the largest banks in the country at the time, had sold derivatives to Proctor & Gamble. The lawsuit set the stage for a stunning revelation: Bankers’ Trust employees took advantage of the fact that derivatives were too difficult to understand. ibid.
Trillions of dollars and the biggest banks in the country operating in secret. ibid.
Born’s warning became a prophecy. ibid.
The Wall Street banks were pressured to bail out LTCM themselves. ibid.
Some in Congress began to clamour for regulation. ibid.
Alan Greenspan had no intention of yielding. ibid.
Congress did decide to do something about Brooksley Born – they stopped her entirely. ibid.
Wall Street was largely left to regulate itself. ibid.
Have you taken a large home loan? Or did you put your savings in stocks, mutual funds or bonds? If not, you can relax. But all of us who did are living on borrowed time. This is the story of the greatest financial crisis of our time: the one that is on its way. Overdose: The Next Financial Crisis, 2010; viz also Johan Norberg, Financial Fiasco
In 2003 it [interest rates] was cut all the way to 1%. ibid.
Greenspan argued that the Fed should never remove the punch bowl. But rather start refilling it when the party started to peter out. And if things went bad, the Fed would clean up the mess and tend to the hangover. ibid.
The big banks dared to make riskier loans because they had started repackaging loans and selling them to others as securities. ibid.
The rating agencies that rate securities gave the mortgage-backed bonds their highest rating ... The rating agencies were being paid by the sellers of securities. ibid.
The difference is that this bubble is much bigger. ibid.
Even banks who don’t want the money will be forced to take it, so that the public won’t know which banks are on the brink of collapse. ibid.
Congress approves the biggest financial bail-out in history: $700 billion. ibid.
President Bush gives billions of dollars to General Motors and Chrysler. ibid.
On February 7th 2009 Obama approves a stimulus package worth $787 billion; with the Bush stimulus package from year before, US politicians have now spent close to $1 trillion to stimulate the US economy. ibid.
We have been saved from the consequences of one burst bubble by inflating a hundred new ones all around the world. ibid.
Bush almost racked up more US debt that all presidents before him combined. ibid.
Each time and every time a bank makes a loan, new bank credit is created – new deposits – brand new money. Graham F Towers, governor Bank of Canada 1934-1954
What Wall Street and credit card companies are doing is really not much different from what gangsters and loan sharks do who make predatory loans. While the bankers wear three-piece suits and don’t break the kneecaps of those who can’t pay back, they still are destroying people’s lives. Bernie Sanders
By the end of the decade hundreds of savings and loans companies had failed ... Thousands of Savings & Loans executives went to jail for looting their companies. One of the most extreme cases was Charles Keating. Charles H Ferguson, Inside Job, 2010
In the early 2000s there was a huge increase in the riskiest loans called subprimes. ibid.
The investment banks actually preferred subprime loans because they carried higher interest rates. ibid.
Lehman Brothers was the top underwriter of subprime lending. ibid.
Neither a borrower nor a lender be. William Shakespeare, Hamlet I iii 75, Polonius to Laertes
Britain who had once been the world’s banker, we were now the world’s single biggest debtor nation ... He [Attlee] turned to the economist John Maynard Keynes and sent him to Washington ... No gift but a loan of just under $4 billion, with interest, just half of what he thought was vital ... The last of that loan was finally paid off December 2006. Andrew Marr’s History of Modern Britain, BBC 2007
These loans are very expensive but very often the only funds small businesses can get. Danny Schechter, In Debt We Trust ***** PSTV 2006
Pay-day loan stores charging interest that would make the Mob blush. ibid.
The economy might be struggling but one area of business is thriving – the debt business – payday loans and door-to-door lending. Panorama: Undercover: Debt on the Doorstep, BBC 2012
We reveal the real costs of taking out a loan. ibid.
Provident dominate the doorstep-lending market. ibid.
Agents are encouraged to sell more loans. ibid.
Tonight: the fraudsters helping bogus students rip off student loans. They’re targeting private colleges backed by the government to open up higher education to all. For a cut of the student’s loan or cash fraudsters can fix everything. They’ll even help fake your coursework. Panorama: Student Loan Scandal, BBC 2017
It’s estimated that three-quarters of graduates may never pay back their student loans in full. ibid.
Commercial banks create chequebook money whenever they grant a loan simply by adding new account dollars in accounts on their books in exchange for a borrower’s IOU. Federal Reserve Bank of New York, I Bet You Thought p19
Banks lend by creating credit. They create the means of payment out of nothing. Ralph M Hawtrey
In fact this is precisely the logic on which the Bank of England – the first successful modern central bank – was originally founded. In 1694, a consortium of English bankers made a loan of £1,200,000 to the king. In return they received a royal monopoly on the issuance of banknotes. What this meant in practice was they had the right to advance IOUs for a portion of the money the king now owed them to any inhabitant of the kingdom willing to borrow from them, or willing to deposit their own money in the bank – in effect, to circulate or ‘monetize’ the newly created royal debt. This was a great deal for the bankers (they got to charge the king 8 percent annual interest for the original loan and simultaneously charge interest on the same money to the clients who borrowed it), but it only worked as long as the original loan remained outstanding. To this day, this loan has never been paid back. It cannot be. If it ever were, the entire monetary system of Great Britain would cease to exist. David Graeber, Debt: The First 5,000 Years
Over 310,000 households across the UK are affected by illegal money lending. The War on Loan Sharks, BBC 2017
Money lending is big news and big business … Away from the high street lie the unscrupulous loan sharks. But who are? How do they operate? What is the human cost? And what can be done to stop them? ibid.
The [Birmingham] project has since gone national. ibid.
The team has helped over 26,000 victims of illegal money lending. ibid.