It has been ten years since the beginning of the Great Recession. The cataclysmic event started in the United States, with the crash of the subprime mortgage bubble in 2007. Other factors, such as predatory lending, fraudulent underwriting practices, and excessive risk-taking by financial institutions, increased the debt and eventually escalated into a full-blown banking crisis.
In the United States leading up to the crash, high mortgage approvals and low interest rates triggered a spike in home purchases. This drove up housing prices, which led to large numbers of homeowners borrowing against their homes as an apparent windfall. Unfortunately, many homeowners were unable to pay back their loans, and high delinquency rates led to the rapid plummet and devaluation of financial assets. The banks that had invested in the loans were facing a major liquidity crisis. In other words, the bubble had burst.
On September 15, 2008, the investment bank Lehman Brothers filed for bankruptcy. By the next day, at least seven other major financial institutions were all expected to follow suit. To prevent this outcome, and a possible collapse of the world financial system, the US federal government paid several trillion dollars to bail out the banks. Despite the bailout, the crisis was followed by a global economic downturn: the Great Recession..
NBC News Archives has assembled a trove of clips covering the 2008 financial crisis. Click here to see the best.