I always like the quote from the movie 《The big short》-- It ain’t what you don't know that gets you into trouble. It's what you know for sure that just ain't so. It's almost too simple to summarize the cause and aftermath of a financial crisis, but once you delve into it you will find many question marks along the time line. The financial crisis that happened more than 10 years ago entangled tons of financial institutions and millions of people, but it's really a three men show and two big trades. I am not attempting to write a overwhelming piece but only to explain things in a realively novel and simple manner based on my humble effort.
This summer I was reading Ben Bernanke's "bibliography" 《The courage to act》, I realized the financial crisis has bypassed for more than 10 years. Now people are talking about the surge of a new cycle, I felt obliged to record down my own thoughts about the past crisis along side the many books/documentaries I have read and seen on this topic.
The three men show I mentioned beforehands refered to Ben Bernanke -- the then FED (Federal Reserve Board) chairman, Hank Paulson -- the then Treasury Secretary, and Tim Geithner -- the then President of Federal Reserve Bank of New York (where all those gold are stored). And the two big trades were done by another Paulson -- John Paulson, he is shorting the subprime market in 2007 and shorting banking industry in 2008. The "two hit wonder" accumulates him the wealth of more than 15 billion dollars.
I liked Hank Paulson's remarks during the senate testimony, "If you've got a squirt gun in your pocket, you may have to take it out. If you've got a bazooka, and people know you've got it…you're not likely to take it out."