Abstract
- The USA and the world are in a complex economic crisis. As of February 2013, President Obama and his followers both in government and the mass media, continue to extol the virtues of “staying the course” of massive deficit spending on a scale comparable to this nation’s involvement in the Second World War. As has been true throughout this nation’s history, economic mismanagement by the political party in power is always deflected from its true origin to that of being the bastard child of the former administration. And this is just as true today. “Fat cat” bankers and Wall Street financiers became a convenient whipping boy since few Americans understand the intricacies of financial markets and their importance to a smoothly operating national economy. The authors conclude that since the economic crisis encompasses most of the world’s advanced economies, there is no single financial institution or confederacy of institutions that were large enough to bring about a crisis of this magnitude.The paper seeksthe answer from whence the crisis began the housing market of the United States. The two most influential entities in these markets are: (1) the Federal Reserve; and (2) Fannie Mae and Freddie Mac, the two Government Sponsored Enterprises specific to the U.S. housing market. With the epicenter of the world financial crisis pinpointed, an investigation found that the activities of both entities had been championed by preceding administrations of both political parties. With this knowledge in hand, we were able to identify the individual protagonists of this debacle. The contribution to this on-going, complex financial crisis is that we have done much more than just present a historical account of the event that has shaken the economies of the advanced nations.The authors identify the protagonists and we capture their shoddy economic analysis and self-serving public statements from the time period several years before and in the weeks following the bomb’s ignition