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We believe that everyone should be able to understand how the financial crisis came about, what it means for all of us, and what our options are for getting out of it. Unfortunately, the vast majority of all writing about the crisis – including this blog – assumes some familiarity with the world of mortgage-backed securities, collateralized debt obligations, credit default swaps, and so on. You’ve probably heard dozens of journalists use these terms without explaining what they mean. If you’re confused, this page is for you. Over time, we will be adding more explanations and more links to external sources, so check back for updates. (Some of the explanations on this page are simplified and not 100% accurate; their goal is to explain the key concepts to a general audience.)

Contents

Radio shows
Video
Other web sites
Articles on this page

Securitization, CDOs, and banking capital
Stock market vs. credit market
Crises of confidence and bank runs
Credit default swaps
Bank recapitalization
De-leveraging (or, where did all the money go?)
Separate posts

Currency crisis
Recession
Federal Reserve
Credit default swaps, herald of doom
Japan’s lost decade
Interest rates
Mark-to-market accounting: This one gets a bit technical, but the first part covers accounting in general and mark-to-market accounting
Risk management and value-at-risk
“Bad banks”
Sweden
Is saving good?
Bank capital, capital adequacy, and tangible common equity
Convertible preferred shares and the Capital Assistance Program
Nationalization
Macroeconomics of the financial crisis
Comparison of different toxic asset plans (by Mark Thoma)
Structured finance: This one presumes a basic understanding of what a CDO is.
Inflation expectations
Financial innovation
GDP growth rates and other economic statistics
Stress tests
Option and warrant pricing
Regulatory capital arbitrage (new 5/30/09)
Planet Money collaboration

National debt
Radio

This American Life, The Giant


Links: bergman | October 7, 2008 at 12:31 pm | excellent explanation. count chocula | October 7, 2008 at 1:13 pm | Awesome page! Mike | October 7, 2008 at 1:20 pm | Thanks for this site L. Shull | October 7, 2008 at 1:24 pm | I likewise saw Simon Johnson this morning and appreciate his ability to explain these complicated issues Ron Baldwin | October 7, 2008 at 1:39 pm | I was very impressed with Simon Johnson when I saw him on C-Span (one of the panel members) participating in a discussion at The Brookings Institute. stanley williams | October 7, 2008 at 5:48 pm | I cannot thank you enough for making a feared subject understandable S. Frazier | October 7, 2008 at 5:49 pm | I saw Simon Johnson on C-Span this morning Babu | October 8, 2008 at 9:28 am | Hi Darryl Cochrane | October 9, 2008 at 12:10 am | I’m another who saw Simon Johnson on C-span Babu | October 9, 2008 at 12:30 pm | Thanks for the explanation on bank runs and how asset vs liability issue has caused to the current problem James Kwak | October 9, 2008 at 3:32 pm | Babu, that’s a reasonably close analogy Babu | October 9, 2008 at 8:21 pm | James, Thanks and that helps Pingback: Scott’s Blog » Blog Archive » More Financial Crisis Info Rich | October 11, 2008 at 10:31 pm |
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