Friday, October 10, 2008

Scary Finance Geek-Out

At last I've come across something that seems like a good, clear explanation of what has been happening in the financial markets of late: Another Frightening Show About the Economy, a recent and freely-downloadable episode of This American Life. It traces key events that go, roughly, from bad mortgages, to the failure of Lehman Brothers, to the failure of a major money market fund, which led to the collapse and near-collapse of other big money market funds, which has seized the capital markets and thus hindered the regular flow of business across the economy. They also give a good explanation of credit default swaps and how those have contributed to the problems.

It's worth a listen if you want to get a handle on what's happening.

The daily Planet Money podcast (also free) is also attempting to explain the mess as it continues to unfold, although I haven't actually listened to this yet.

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Update: John at Obscene Desserts points to some more primers on this financial mess for those of us feeling a little below our, uh, pay grade on these matters. I have to admit I'm still hoping someone will explain the explanation some more, but I'm getting there.

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