The Crisis of Credit Visualized
By Barry Ritholtz - February 20th, 2009, 8:15AM
The Short and Simple Story of the Credit Crisis, via Crisisofcredit.com:
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The Crisis of Credit Visualized from Jonathan Jarvis.
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From the author:
The goal of giving form to a complex situation like the credit crisis is to quickly supply the essence of the situation to those unfamiliar and uninitiated. This project was completed as part of my thesis work in the Media Design Program, a graduate studio at the Art Center College of Design in Pasadena, California. For more on my broader thesis work exploring the use of new media to make sense of a increasingly complex world, visit jdjarvis.com.
Its not perfect, but its well done . . .
February 20th, 2009 at 9:05 am
It may not be perfect, but that was AWESOME! I about fell out of the chair laughing about the “somewhat less responsible” homeowner graphic! Liquior drinking, smoking, multiple kid families! Some might call it bad taste, but I call it funny as hell!
February 20th, 2009 at 9:10 am
Barry,
Enough about how bad the housing, credit, etc. is. Can we start getting some posts on just what we should be doing with our money in a depression. How about some investing advice. We get it already everything sucks.
February 20th, 2009 at 9:17 am
SWMOD52:
be long QID…your money should double from here…when the market is a smoldering crater (I will tell you), sell your QID and put the money in highest safety insured CDs. Wait a few years (I will tell you) and put every cent into a gold mining ETF. You will make 10 times your money. It’s that easy…total return, 20X initial investment.
February 20th, 2009 at 9:18 am
Today could be the day that a CNBC anchor breaks down in tears…watch for it. Probably one of the ladies, but you never know. Any bets?
February 20th, 2009 at 9:45 am
@Steve Barry… LMAO
February 20th, 2009 at 9:57 am
great work
February 20th, 2009 at 10:03 am
from one artist to another I thought it was well done and accurate to my pov as acquired from TBP
1st comment from edit/correction/legal department was the early on fail to mention Wall St commission process
I’m wondering how much creation time is involved and if a ROI structure is in place?
I need to educate myself on these possible mechanisms. ISP & TechInd return/payolla maybe via Click Pay system. Or the standard way, commissioned by an entity for their ROI. Or buy our Techie stock and get your payback. I suppose it will end up with Schoolhouse Rock and other the Hall of Fame archives.
You do get some good stuff from “outta the goodness of my heart and desires” system. Bush I called it 1000 Points of Light. Our new President is going with http://www.usaservice.org
this was a favorite passed on to me about 14 months ago:
http://video.google.com/videoplay?docid=-9050474362583451279&q=Money+as+debt&total=1040&start=0&num=10&so=0&type
February 20th, 2009 at 10:25 am
Very nice visualization. I wish they had shown the rating agencies stamping the “safe” risky CDO slice as AAA though.
February 20th, 2009 at 11:25 am
This was the first presentation I’ve seen that clearly and simply illustrates tranches, which have never been easy for me to get my head around.
It also well illustrates the folly of trying to artificially support home prices at artificially high values.
February 20th, 2009 at 11:41 am
@Douglas:
Why didn’t you say so…here is the funniest, simplest explanation around:
http://docs.google.com/TeamPresent?docid=ddp4zq7n_0cdjsr4fn&skipauth=true&ncl=true
February 20th, 2009 at 11:58 am
Thank you, Mr. Barry. That made my day.
February 20th, 2009 at 1:04 pm
Excellent. It hit on all the basic subjects in an easily understandable way. They should show this in every high school in the country. We need one of these for the bailouts as well.
February 20th, 2009 at 2:55 pm
Hi, here’s an interesting and quite different theory of credit creation. I don’t know what Australian Paul Keen’s bona fides are but the post and theory don’t seem to partake of crank or conspiracy theory and I wonder what others might think of this.
http://www.nakedcapitalism.com/2009/02/steve-keen-roving-cavaliers-of-credit.html
Basically credit creation is _not_ driven by the Fed or M0 (that is a zero – I wonder how it will come out on other people’s screens – looks like a lower-case ‘o’ on mine) or whatever – but rather by the banks. This reverses the causality and one implication is that Bernanke’s doubling of the (base) money supply in the last 2 (?) years (or less) will _not_ get the banks to lend again.
Now that is the case (it is true that the banks aren’t lending) and there are various theories I’ve heard in that regard (they’re scared; their reserves are low-to-nonexistent; and they want to sit on the money for safety), but this approaches the matter from a very different direction. Sort of the opposite direction.
‘Roving Cavaliers of Credit’ is apparently attributed to Karl Marx. (who seems to be having something of an intellectual comeback these days).
February 20th, 2009 at 3:21 pm
Make that Steve Keen. And this appears to be his blog (and the above url was a repost on nakedcapitalism):
http://www.debtdeflation.com/blogs/
Hmm debt-deflation. That reminds of someone else I’m reading at the moment. And someone else whose ideas are in the process of being reconsidered: Irving Fisher. He made some big gaffes at the outset of the Great Depression (and some people write him off on that basis alone), but otherwise his bona fides are impeccable. As best I understand he was the US’s first true mathematical economist (no – it’s not a contradiction in terms). Lived through the Great Depression (had a ringside seat) – and after his first egregious reactions – thought deeply about what had occurred and came to his own very interesting (and non-standard) interpretation. Or maybe others here consider Fisher to be very much in the mainstream. No idea.
February 20th, 2009 at 3:24 pm
> How about some investing advice. We get it already everything sucks.
Carefully chosen and closely watched double-short ETFs. That is, until the market hits bottom. Which may be a contradiction in terms. But this is one of those paradoxes we’ll have to live with.
Two that worked for me (but I wouldn’t recommend at the moment) are DTO and EEV.
February 20th, 2009 at 7:29 pm
I liked this, as well, makes for a good intro to the discussion..
as an aside, it made Icerocket’s front page, under ‘Video Buzz’
http://www.icerocket.com/
February 20th, 2009 at 9:58 pm
this: http://www.youtube.com/watch?v=b_vN0–mHug
may be the, proper, *Real World Reverse of the Coin with “Financialization” on its Obverse..
FWIW, there’s more than one Video compilation, available on YooToob, that accompanies this Song..
and, please note, it’s always, and correctly, termed: “Financialization”, never: “Economic-ization”
the difference is Cardinal.
http://www.thefreedictionary.com/cardinal