The global credit crunch has dominated the news for weeks. Here’s an excellent background article from the NZ Herald this past weekend which lays out the history which got the world economy to this point.
NZ Herald: How the Financial Dominoes Tumbled
The financial meltdown of the last week has hammered home the predictions of many who said there was more fallout to come from the US credit crunch.
But for those not so closely embroiled in the goings-on of Wall St and the financial markets it's hard to know how we have got to a point where some of the world's most well-known banks and insurance companies are going under.
Who would have believed two years ago that Britain's Halifax and Bank of Scotland (HBOS) group - the UK's biggest mortgage lender, would come to a point where it would need to be bailed out through an emergency cash injection from Lloyds TSB?
Or that American International Group (AIG), a global insurance firm with US$1 trillion ($1.48 trillion) in assets, would have to be stopped from going bankrupt with an emergency loan from the US Federal Reserve.
So how did we get to this? Follow this link.