This American Life Demystifies the Housing/Credit Crisis

There’s been no short­age of arti­cles try­ing to explain the ongo­ing hous­ing and mort­gage cri­sis. But none does a more clear and enter­tain­ing job than this recent episode of This Amer­i­can Life, “The Giant Pool of Mon­ey” (iTunes — Feed — MP3). Step by step, the show traces how we got into this mess. Along the way, you’ll dis­cov­er how 70 tril­lion dol­lars of glob­al mon­ey need­ed to get parked some­where, and it found the US hous­ing mar­ket. As the mon­ey poured in, the Amer­i­can invest­ment com­mu­ni­ty cranked out as many mort­gages as it could. And when there were no more qual­i­fied home buy­ers left, the banks start­ed low­er­ing lend­ing stan­dards until there were none left. In the end, even dead peo­ple were get­ting mort­gages (sad­ly, a true sto­ry). Give the pod­cast a lis­ten. The whole deba­cle gets pieced togeth­er in a way that you’ve prob­a­bly nev­er heard before.

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