The 2008 Financial Crisis - 5 Minute History Lesson

It's been 10 years since the Lehman Brothers bankruptcy, considered the height of the 2008 Financial Crisis. But what caused this behemoth to go under, and how did we find ourselves in a real estate bubble? Let's find out with a 5 Minute History Lesson.

Episode Music:

DISCLAIMER: Richard does not have a personal holding in any of the referenced companies

[ThePlainBagel]

Sorry for the re-upload everyone! Wanted to fix a blunder I had in the original video since this is such an important topic.

[nickbargas]

It just goes to show some companies can't fail as long as they are backed by government. If I did something like this I would be in prison for life without the possibility of parole.

[firstnamelastname]

"the big banks wont fail because theyre not supposed to"
-bill wurtz

[HodgeChris]

The fact that there is already an excessive amount of demand awaiting its absorption, despite how everyone is frightened and calling the crash, is another reason why it is less likely to occur that way. 2008 saw no one, at least not the broad public, making this forecast, as I'll explain below. The ownership rate was noted to have peaked in 2004 in the other comment. Having previously peaked in the second quarter of 2020, we are currently at the median level. Between 2008 and 2012, it dropped by 3%, and by the second quarter of 2020, it had dropped from 68 to 65.

[lizardlegend]

The 2008 crash had a huge effect here in Ireland. We're still experiencing the aftermath of it. Dublin has one of the highest rent rates in the world and we're suffering from an extreme housing crisis. Meanwhile the banks got bailed out and those responsible are enjoying a nice huge pension.

[daltonevans]

"It's free money!"
Biggest lie ever told. Someone tells you a way to get free money, it's going to end bad every time.

[PositiveInvesting]

Appreciate the time taken to correct mistakes - most don't bother and I think it's important to address it on topics like this!

[levaann]

The memory of the 2008 crisis still feels kind of fresh to me. The house that my parents saved for 10 years, lived for in 2, gone within a year, It was awful. 2020 now and It's a lesson for me and my siblings to learn.

[roseq]

Just as millennials were leaving college and trying to get into the workforce, this is what we were met with (that and 9/11 in HS). My friends could only get temp jobs, working up to 3 months at a time. Went on for years. Most millennials still struggle to afford and buy homes. The goalpost keeps getting moved.

[ziggy]

Hey! I paid for 5:00 and only got 4:59! What gives!

[nothoughtsjustphotosynthesis]

All three of my dad's biggest clients went under in 08 (Lehman was his top client, he's a commercial real estate appraiser.) It was the first time I can remember my parents being worried and stressed in front of us, they normally hid all that stuff pretty well. Now as an adult it's interesting to see how a lot of my fears over financial stability and the economy started that year.

[Jox]

I’ve learned from history that whenever i hear “free money” or “infinite money glitch” or “it literally can’t go tits up” to prepare for the worst. Remember kids it works until it doesn’t and then it implodes and ur in debt :)

[michelakras]

WOW, it took you 5 small minutes to explain this whole very important subject, and I am sure it will take me much more to re-watch your presentation to re-understand what it was all about and how it happened... (after a concentration of 2mns, I got carried away by your nice and funny illustrations not to forget the sound effects!!!!)... Thanks for this great job.

[PassiveIncomeTom]

The last crash was bad for everyone not prepared . Thanks for the reminder!👍

[NapGod]

I was an upperclassman in high school in '08. My dad filing for bankruptcy, my parents' divorce, the foreclosure on our house, and the evaporation of nest eggs like mine and my siblings' college funds were some of the immediate effects. The events over two years completely changed the directions of our lives - the fallout quietly permeating for years in different ways. I learned two extremely important things: 1) how to stand back up after being knocked down 2) Greed will *always* trump common sense and decency in a society enslaved to Capitalism *gestures broadly to Citizens United in 2010 and the partial repeal of Dodd Frank in 2018 which somehow didn't include the full reinstatement of Glass-Steagall when it was drafted and passed into federal law*

[RedsHitpostMedia]

I literally lived through this at 13. And i remember it was just endless discussion and talks on all news/radio. Didnt understand a lick of it then and still mostly dont. But now i learned something

[booklist]

"Greed should never trump common sense and decency"
Hahaha, good luck with that. Never going to happen sadly.

[BlasianBobbi]

There’s another aspect to this:

I was living in Florida when 2008 happened. I remember a couple of years before the crash, a knew a couple of people that didn’t have a pot to piss in, all of a sudden were buying houses. This video isn’t lying about how loose the lending became. Even the church my mom went to got into the “rental property” business. The daughter of the preacher and her new husband bought 10 houses in one year. The preacher and his wife did the same, the church choir leader and his wife? They literally started a company, and had plans to build a whole subdivision (I’m not kidding when I say this, they showed us the blueprints to the subdivision). I’m not gonna bog the comment sections, but the TL;DR version is the preacher and his wife lost all their homes and had to move themselves and their 7 kids into the church, itself. Their daughter and her husband literally lost everything. They were riding off the thousands a month they were getting from their rentals, but once those balloon/adjustable payments hit after a year or so, they couldn’t afford day to day expenses, and they just had a child. Husband had to enlist in the military. The church choir leader? That was a doozy. They were also in the process of building this gigantic house that had a butlers quarters and all that, but when the crash hit, the house was only half finished. The bank said they didn’t want it, but since it was mortgaged, they were still liable for the payments.

[tuck]

4:42 hearing the DOW Jones drop 1/3 of its value actually sent shivers down my spine

[DavidAntony-gqid]

Well that would be impossible to do considering I'm in my late 50s and I'm more interested in investments that could set me up for retirement in my 60s, my goal is at least $2million.