Visualizing the credit crisis

Excellent! I was impressed with a precursor to this explanation ( http://tinyurl.com/2kvosz ), but this does an even better job at explaining how things collapsed (with less profanity, too...).

Great explanation and execution. Love the depiction of the "less responsible home owners."

My 2 year old son walked into the room when the video went dark as the credit dried up. He said, "uh-oh". Uh-oh is right, Theo.

Ha! Glad to hear the message rings universal. Thanks for the feedback.

I received a link to this animated version of the primer you mentioned in French: http://www.dailymotion.com/relevance/search/unlimited/video/x7opb7_le-baba-d

This is excellent. Any ideas what software was used to create it? Alternatives?

I am a mortgage broker. What is missed in this presentation is the reset the sub-prime loans to a much higher margin by the lenders in 2004. The new margin together with increases to prime (indexes) made the loans unaffordable. These adjustments to how the new interest rates were calculated were more of a contributing factor to foreclosure then the high risk borrowers. Banker greed promising higher returns for the investor killed sub-prime. So Greenspan started the meltdown by lowering the interest rates, he also accelerated the foreclosure rate by quickly doubling prime from 4% to 8.5%, an index that greatly affects all the other indexes. Indexes tripled in cost in one year and together with the margin that were doubled from the old margins set all the ARMs to fail when the new interest rate was calculated. Borrowers saw their monthly mortgage payment increase 40% in one month. Trapped in homes with declining value the homeowner was left no choice but to walk away. I talk to a family who faced this choice almost everyday. Who would not fail under those conditions. If the Banks had started mitigating foreclosures two years ago like they do today, a million families would not have lost their home.