Who Caused the Financial Catastrophe? The Inside Story of the 2008 Crisis

Who caused the financial catastrophe? The impact of the 2008 financial crisis and the credit crunch was devastating to the financial system. Banks were unable to lend money, which led to the cessation of all commercial activity in the Western world. The banking industry was referred to as the 'root of all evil' because without bank credit, business activity would come to a standstill. To solve the credit crunch crisis, the US government immediately injected trillions of dollars into the banking system by issuing money and putting it into the Federal Reserve. The Federal Reserve lowered interest rates close to zero. This was the largest and longest period of unlimited and zero-interest quantitative easing that the US government and the Federal Reserve had ever undertaken.

The Federal Reserve immediately distributed the trillions of dollars it received to major banks, which were actually members of the Federal Reserve. Banks were supposed to lend out the money to ease credit, but they did not do what they were supposed to do. Bankers used the money they received to buy Treasury bonds, especially long-term bonds. The Federal Reserve knew the US government's financial policy because it is a 'private banking organization' that implements financial policy. Buying bonds while interest rates were still high could earn big profits, so why lend money to earn interest spreads? As a result, major banks held large amounts of Treasury bonds. Lowering interest rates caused US bonds to appreciate, and banks made a lot of money. Bankers' dividends went from astronomical figures to super-astronomical figures. All the unlimited money went into the pockets of bankers.

You may ask, what about long-term bonds that are 20-30 years old? When the Federal Reserve raises interest rates in the future, bond prices will fall, and banks' assets will not cover their liabilities. What happens then? Don't worry, if banks go bankrupt, stocks become worthless, investors' investments will be in vain, and depositors may not be able to withdraw their deposits, but bankers' dividends have already been safely pocketed, and stocks have long been sold out. When interest rates rise and bond prices fall, banks will be in trouble, and another financial storm will allow bankers to make more money. Every financial crisis is an opportunity for bankers to make money.

Even first-year university economics students know that excessive issuance of currency can cause malignant inflation, and the only way to control inflation is to raise interest rates. Holding a large amount of US bonds during interest rate hikes is just asking for trouble. The government, central banks, major banks, and financial institutions hold a variety of bonds with losses of tens of trillions of dollars. Bankers are stepping on the gas pedal on this death highway. You all know how it ends, so no need to explain further.