What caused the current financial crisis and how do banking and currency crisis fit into the equation?

did the crisis start in america? regardsWhat caused the current financial crisis and how do banking and currency crisis fit into the equation?
The current economy recession is the result of many factors but to put it simply. Banks made money too easy to borrow.



Prior to Regan there was a system of regulations in place to prevent banks from just willy nilly lending money but under 'reganonics' the deregulation bug set in and took that system away and a few banks started just giving money to anyone who asked for it and CEO's who were looking to keep their stock prices high followed suit and began to do the same. The most egregious cases was in the mortgage industry where you didn't even have to show proof of income to get a loan in some cases! And they lured people in with adjustable rate mortgages with 'teaser' rates.



So anyway as the teaser rates readjusted and home values began to finally decline people where unable to make their payments and couldn't refinance since they owed more than their home was currently worth they began to default (note had the govt stepped in at this point the crises could've still been averted) . Well as more and more people defaulted and their homes went into foreclosure the values of homes began to fall even further meaning the re-fi door was closed to even more people as their interest rates increased and the cycle just fed on itself. Also people were taking on outrageous amounts of debt in the form of credit cards as well and that added to the recession. So as more and more people defaulted on their loans the banks and other financial institutions began to hemorrhage money and they locked credit to avoid loosing anymore. As a result of this since we live on a debt based system the other businesses couldn't get the loans they needed to keep going and they were forced to cut back and/or go out of business thus laying off more people who then couldn't pay their loans adding even more to the recession.



This is a simplified explanation but I hope it answers your question!



I hope that helpsWhat caused the current financial crisis and how do banking and currency crisis fit into the equation?
This present "recession/depression" is an old republican scam which runs back into the 1800's. First you get the banks to make shady and shaky loans - everybody makes money - the rich borrow like crazy. Then the whole banking system disintegrates when the money can't be paid back. Then the taxpayer is supposed to do a bailout to "save the banks" (pay the rich people even more money).



When FDR came in, he put programs in place to prevent this - but years later when Reagan came in, he began breaking down this system - he wanted "deregulation". This is shorthand for republican theft. Reagan's most famous banking scam was the S%26amp;L Scandal of the early 1980's.



And it all culminated with Li'l Bush and the biggest theft in human history - the inevitable bailout for $700 Billion dollars - which is then just given away. We have nothing to show for it nor do we even know where it went for sure. The Super Rich just soaked it up. It's "gone" - just like the billions thrown away in Iraq - the money is just "gone".



And so it goes. And there's still Americans supporting the republicans....