I came across this little cartoon which explains what the crisis is all about (there is a part 2 as well).

Now the naive bit—the toxic assets, the sub-prime mortgages are people’s homes. They need somewhere to live. So if they default due to lack of employment or whatever then the houses now belong to the government (having bailed out the banks). The government announced a short while ago that there was a shortage of rental property—well there they are then!

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