2008 economic crisis assembly presentation.97
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TRANSCRIPT
MORTGAGES:
DEFAULT: can’t payoff mortgages
FORCLOSURE: after defaulting, bank seizes your property
MORTGAGE BACKED SECURITIES:
home loans bundled together.•Values are unknown
•Securities wont work if you stop paying mortgages
Loans from the bank to purchase property
• You end up without a house• Bank ends up with a house– Banks are not in the real-estate business
REPOSS ---
S ESSEDPROPERTY OF THE BANK
________________________________________________N O T I C E
THIS PROPERTY HAS BEEN FORECLOSED BY THE BANK.
HOMEOWNER’S FAILURE TO PAY OFF MORTGAGES.
THIS PROPERTY AND ANY ASSETS ARE NOW OWNED
BY THE BANK.
Rescue/Bailout Plan
• Treasury Dept. and Secretary Paulson have $700 billion at disposal
• Will purchase bad mortgage securities from banks
• Banks ability to give out loans is based on how much money they have
• Bill is constantly updated and modified
Government & Banks
• Expanded role with Banks
• Purchased $250 Billion
• Government has partial ownership
• Temporary/Short Term
GLOBAL ECONOMY● Affecting the entire world● Related stock markets● Recession
EIGHT COUNTRIES● Mostly European● Working with the U.S.
COORDINATE THE ECONOMIC POLICY● Global coordination
DO WE NEED A NEW GLOBAL ECONOMIC
STRUCTURE?G8G8