
That's me and my awesome dog, Hawley.

That's where I grow food.
That's my closet full of home brewed hobo wine
And shred photos are soon to come.
Prepare for decline my friends. Inevitability needs no invitation.

That's me and my awesome dog, Hawley.

That's where I grow food.
That's my closet full of home brewed hobo wine
The Crisis of Credit Visualized from Jonathan Jarvis on Vimeo.
This animation explains a lot about what is happening in the economy, but it doesn't explain everything (of course, it would be hard to do so.)
What it does mention, is the Fed's role in creating the situation by dropping the interest rate to near zero. A further in depth look at that action would reveal that by lowering the interest rate, what happens is the money supply increases drastically. Furthermore, the money supply is actually just loans, as in, the banks made a lot more loans to homeowners.
The problem is (in part anyway), by so rapidly increasing the amount of loans, also increased is the amount of interest needing to be repaid, which requires an ever increasing money supply. Remember, when a loan is given, the amount of that loan is created instantaneously out of thin air, but the interest is not. By exponentially increasing the amount of loans, the banks exponentially increased the amount of interest due, which requires new money to service. Essentially, this is the pyramid scheme of our economy, which like any Martingale betting system, seems stable for a while, but eventually kicks into high gear and is impossible to continue.
(NOTE: A Martingale system of gambling is when you double down on every loss hoping that when you win, you cover all previous losses. For example, betting a dollar on black on a roulette wheel. When it comes up red, you bet two dollars, then if you lose again betting four, then eight. At first, this is servicable, but eventually gets out of hand when you are betting $256 or $512, etc.)
By substantially increasing how many loans were made, in order to profit by selling the loans, the amount of money necessary to pay off the interest would have to be created as well, which can only occur when new loans are made, which increases how much debt and interest exists, which requires new loans, ad nauseum.
See the flaw here? Debt creates a viscious cycle of repayment that requires more and more resources be expended paying and collateralizing. Of course, the major bankers win out every time because it costs them nothing to create capital, and they get to vacuum up all of the collateral posted on loans.
As the animation shows above, banks begin refusing to lend. That means no new loans, which means no new money, which means there isn't enough to service interest on old loans, which means defaults. Massive defaults means even less lending, etc, etc.
The question seems to be, by allowing mortgages to be chopped up and sold as investments during a low interest period, thus creating a demand for more mortgages and allowing riskier mortgages to be made, the money masters must have realized this was going to push their economic Martingale scheme into high gear (Imagine instead of one bet on a roulette wheel, now you have several, all doubling upon losses). Why would they allow this to happen? Of course, "they" in the upper echelons don't lose out, but they must have realized a depression would be inevitable.
So was this economic depression planned? It seems it was inevtiable. Why now? Why did the "they" choose this period to lay out such a timebomb? Could it be because of resource scarcity? Could it be a controlled collapse, and final looting of US assets?