The Global Financial Crisis according to Aaron Clarey

Global Financial Crisis Survey

Aaron Clarey published Behind the Housing Crash in 2008 and it holds a rare 5 star customer review rating at Amazon. From 1998 to 2007 Clarey was an Analyst for several twin cities banks, where he spend those last few years warning his employers about the impending crisis before resigning in protest. He blogs here and you can read more about him at

1. Which FCIC View best represents the causes of the Financial Crisis?

Majority Conclusions, but agree with some of the other points from other opinions.

2. Which narrative presented by Douglas Elliott and Martin Baily of the Brookings Institute in Telling the Narrative of the Financial Crisis: Not Just a Housing Bubble best represents the causes of the Financial Crisis?

“Everyone” was at fault: Wall Street, the government, and our wider society.

3. I believe the Global Financial Crisis is ongoing and will end in the year

2013 or beyond.

4. What were the primary causes of the Global Financial Crisis?

A laziness and sloth brought about by the wealth-producing forces of capitalism in the post WWII era. This wealth made people soft and over 2-3 generations made these people forget there was no such thing as a free lunch. Instead of production, these veritable adult-children wanted to believe in perpetually increasing asset prices as the main form of wealth creation. The discrepancy between actual production and asset prices merely financed by mortgaging the future and burgeoning deficits at the state, federal and local levels.

5. What still should change as a result of the crisis?

Too much to fit into one paragraph. People must learn to spend within their means, and not just spend within their means, but not rely on the government to pay for things they personally and individually cannot afford. Banks and their managers must be allowed to fail and I would go so far as to even banish those bankers and managers that full-well knew what they were doing from ever working in banking again. A constitutional amendment criminalizing rent-seeking and lobbying, punishable by death would also be a big help.

Compiled by Gary Karz, CFA
Host of InvestorHome

Global Financial Crisis Survey

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