THE RISE OF POLITICAL CONSERVATISM 1980 1992
PRESIDENT GEORGE HW BUSH
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The bank executives were all facing jail time for tricking people into getting home loans they couldn’t afford.
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The banks started failing because they told their customers they didn’t have to make the payments because they knew they couldn’t afford them.
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The banks were making a lot of money on selling all the homes they repossessed.
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The banks started failing because so many people were not making their loan payments and the whole economy started falling apart.
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Detailed explanation-1: -The Depression Many of the small banks had lent large portions of their assets for stock market speculation and were virtually put out of business overnight when the market crashed. In all, 9, 000 banks failed–taking with them $7 billion in depositors’ assets.
Detailed explanation-2: -On 15 September 2008 the investment bank Lehman Brothers collapsed, sending shockwaves through the global financial system and beyond.
Detailed explanation-3: -Many banks failed due to their dwindling cash reserves. This was in part due to the Federal Reserve lowering the limits of cash reserves that banks were traditionally required to hold in their vaults, as well as the fact that many banks invested in the stock market themselves.
Detailed explanation-4: -In June 2007, two big hedge funds failed, weighed down by investments in subprime loans. In August 2007, losses from subprime loan investments caused a panic that froze the global lending system. In September 20078 Lehman Brothers collapsed in the biggest U.S. bankruptcy ever.