Overview of the 2008 Financial Crisis

Subprime Mortgages

High-risk loans given to borrowers with poor credit.

Great Recession

Global economic downturn starting in 2008.

Bear Stearns

Investment bank sold for $2 per share in 2008.

Mortgage-Backed Securities

Investments secured by a bundle of mortgages.

Lehman Brothers

Declared bankruptcy in 2008, largest in U.S. history.

AIG Bailout

Federal Reserve lent AIG $85 billion in 2008.

Financial Markets Collapse

Widespread failure of financial institutions in 2008.

Hedge Funds

Investment funds using pooled capital for high-risk strategies.

Defaulting Borrowers

Borrowers failing to meet mortgage payment obligations.

2007 Housing Market

Period of rapid growth before the recession began.