Chapter 1856

Even in mid-2008, rext Morgan still felt that this was just a subprime mortgage crisis and would not evolve into a crisis in the United States and even the world.

Because in the United States, people who buy houses with loans still account for only a small number of the population, and most people still do not have housing loans, the sub-prime crisis is no longer dangerous, and the killing capacity and scope should be limited, which can not cause huge risks affecting the whole United States.

But as strong as rext Morgan, they all ignore the fact that this is not a subprime mortgage crisis, but a financial crisis. Because those financial geniuses on Wall Street invented financial innovation and various Russian dolls' funds, which have spread to financial companies and networks all over the country.

In early 2008, with the closure of three related enterprises, house prices in 286 major cities including New York fell by more than 30%.

Especially with the launch of melon seed second-hand housing network, a network platform for renting and buying and selling second-hand housing, real estate transactions all over the country will be registered on the moving melon seed second-hand housing network. As a result, countless people found that almost overnight, there were a large number of houses waiting to be sold in all cities and all plots.

One of the characteristics of these houses is that the mortgage has not been completed, and the buyer needs to continue to pay the mortgage.

At this time, it is no longer the house of the most garbage vagrants. They give up repaying the loan and throw it directly to the bank.

But the vast majority of secondary users with certain repayment ability also fled.

Their original idea of buying a house was to bite their teeth and buy a house. After a few years, the house price rose two or three times, and then they sold the house. In this way, they realized financial freedom in an instant.

But if house prices not only did not rise, but began to plummet, then the mentality of these people will naturally explode. At the beginning, they also insisted that house prices could not be made well, which was just a technical adjustment.

However, when house prices fell for half a year, especially when a batch of houses were put on the shelves on various real estate trading websites every day, and a buyer was robbed by dozens of sellers, these secondary users suddenly found a terrible fact.

That is, when they thought the house would be worth $1.5 million by then, when the house payment was paid, there might be less than 500000 left, but the repayment they need to pay in 10 years is as high as $1.2 million. If they honestly repay the house loan, they will lose $700000. These people made the most correct decision, That is to directly lose the house in their hands. Even if they have paid the loan for several years, they still give up without hesitation and return it to the bank.

Well, this wise move is called breaking the wrist.

This has become the last straw to crush the whole subprime mortgage crisis.

However, the Federal Reserve, like rext Morgan, believes that this is just a subprime mortgage crisis, so the way to deal with and deal with it is only to acquire those failed companies, sort out their non-performing assets, and then inject capital again to stabilize the mentality of investors, but they do not take into account the troubles of various financial enterprises and banks providing dolly funds.

When a large number of secondary users choose to give up their houses, these banks can only take back the properties and then auction them. Originally, they thought they wouldn't lose much money.

However, when these houses also appeared in the second-hand housing market directly through judicial auction, it directly led to another sharp drop of about 30% in real estate prices. These banks were alarmed.

Those houses that originally lent $1 million and thought they could be worth $1.5 million in the future now have only $500000 left. They are destined to lose $500000.

But when the bank thinks about it, it doesn't seem to panic. These things are packaged into funds and sold to various financial companies!

In other words, although they have to bear part of these losses, most of them have been borne by the investment banks that bought the fund. It's beautiful!

These banks were happy, but the mood of all the investors who bought the Russian Doll fund exploded. Finally, in September 2008, Lehman Brothers, the largest bank playing in the subprime mortgage crisis and the fourth largest investment bank in the United States, announced that they had more than $600 billion in debt due to the subprime mortgage crisis, and all these dollars would not be repaid, So Lehman Brothers declared bankruptcy protection.

The next day, Merrill Lynch, the third largest bank, also announced that it would fail if it could not get an emergency loan of at least $80 billion.

Then in the next few days, investment banks all over the United States announced one after another the problems of Russian Doll funds caused by the subprime mortgage crisis. They all suffered huge losses and could not deal with them, so they had to declare bankruptcy.

These scenes scared all American investors... No, all American people.

They estimated that the basic price of the whole subprime mortgage crisis is about $1 trillion, and the assets of investment banks in the whole country exceed $5 trillion. How can they fall down because of such a subprime mortgage crisis?

As everyone knows, the financial innovation of the Americans and the Russian dolls have directly doubled the subprime mortgage crisis, which originally had a basic price of only $1 trillion, to about $5 trillion, equivalent to the assets of all investment banks. These investment banks have not been drained of all their blood and directly closed down.

At this time, even rext Morgan was sweating, because Morgan bank, a subsidiary of the Morgan consortium, is the No. 1 investment bank in the whole meter. In terms of subprime loans, Morgan bank's related businesses exceeded US $800 billion. If all of the US $800 billion were thundering, Morgan bank would also seek bankruptcy protection.

For a moment, where did Rex Morgan care about lace power? The whole Morgan consortium began to run to save Morgan bank.

It's just that even if rext Morgan is a genius, he can't think of how to deal with the huge deficit of $800 billion, which is simply an inoperable business. The only thing rext Morgan can do is to dig a better pit for himself and make Morgan bank die more comfortable.

Although the absence of Morgan bank will not end the Morgan consortium, the position of chairman and patriarch of rext Morgan can't sit any more.

On the other hand, Goldman Sachs investment bank controlled by the Rockefeller consortium actually faces the same problem. The old guys of the two consortia sat together and finally came up with a good way, that is, to change the business nature of Goldman Sachs bank and Morgan bank from investment bank to commercial bank, so that the two banks can directly absorb deposits from the public, With public deposits, the $800 billion loophole can be filled.

This idea is great. For example, Morgan bank was originally a businessman who got rich by doing business, but there are risks in doing business. The businessman is facing the bankruptcy crisis immediately!

So the businessman decided to change. Lao Tzu rebelled. Lao Tzu was not a businessman. Lao Tzu wanted to be the emperor. Lao Tzu wanted to form a government, and then collect taxes directly from the people and rely on taxes to pay back the money.

Good guy, you're so talented.