Tuesday, August 5, 2008

Super Rich - The Greed Game, How A Few Made Billions & Caused the Current Banking Crisis

As the credit crunch bites and a global economic crisis threatens, Robert Peston reveals how the super-rich have made their fortunes, and the rest of us are picking up the bill.

Sorry about the light description. That's all they have for it on the BBC website.

The doc talks about the current banking crisis and how the subprime loans caused most of it. The banks seem to have brought most of this on themselves.

Loose lending practices by banks that extend credit to people who are only marginally qualified and likely to default have been used to simply get people to take out the loans. The lending bank really doesn't care much about the integrity of the borrower because they sell the loan to another bank or private investor. The guy who issued the loan makes his commission, and the bank makes money when they sell the loan. Profits are being made, but losses eventually show up when people default on the loans.

Such practices can continue for a while, but eventually it catches up and that's what's going on now. There's been too much profiteering and not enough planing for the future. Now Governments are having to come in and bail out the banks. It's an unfortunate situation.

Pass: docs4you.org

No comments:

eXTReMe Tracker