factual... and fun(ny)
The 2008–2009 Global Financial Crisis destroyed approximately $11 trillion to $19.2 trillion in U.S. household wealth, depending on how it is measured. [1, 2]
Breakdown of U.S. Wealth Destruction (2008–2009)
Total Household Net Worth Drop: American household net worth fell from roughly $66 trillion at the end of 2007 to about $55 trillion by early 2009, wiping out $11 trillion in direct collective net worth (with other estimates or broader metrics running up to $16 trillion or $19.2 trillion tracked by the Treasury/Federal Reserve components). [1, 2, 3]
Real Estate Values: Dropped by roughly $7 trillion (housing prices fell nearly 30%). [1, 2]
Stock Market / Equities: Dropped by roughly $11 trillion (the stock market crashed nearly 60%). [1, 2]
Retirement Accounts: Lost an estimated $3.4 trillion. [1]
Unemployment & GDP Gap: The economy suffered an output/GDP gap of about $2.6 trillion, and unemployment peaked at 10.1% in October 2009. Government bailout and rescue programs across the sector totaled around $23 trillion in commitments and liquidity facilities. [1]
if one held their $ came back thanks to the Fed
During the 2007–2008 financial crisis, the Federal Reserve (Fed) intervened through interest rate cuts, emergency lending facilities, and direct support for non-bank financial institutions and key credit markets. [1, 2]
Key Federal Reserve Interventions
Interest Rate Cuts: The Fed aggressively lowered the federal funds rate, eventually bringing it down close to a zero-rate floor (0%–0.25%) by December 2008 to stimulate borrowing and economic activity. [1, 2]
Emergency Lending Facilities: To ease short-term liquidity freezes, the Fed created specialized facilities like the Term Auction Facility (TAF), Primary Dealer Credit Facility (PDCF), and Term Securities Lending Facility (TSLF). [1]
Direct Market Support: For the first time since the Great Depression, the Fed extended direct lending to non-bank financial firms and backed key markets through the Commercial Paper Funding Facility (CPFF) and Term Asset-Backed Securities Loan Facility (TALF). [1, 2]
Specific Firm Interventions: The Fed assisted with JPMorgan Chase's acquisition of Bear Stearns and provided an $85 billion bridge loan to prevent the collapse of American International Group (AIG). [1]
Quantitative Easing (QE): As traditional rate cuts lost effectiveness, the Fed launched large-scale asset purchases—buying long-term Treasury securities and agency mortgage-backed securities (MBS)—to lower long-term interest rates and pump liquidity into the financial system. [1, 2]
be greedy when others are fearful
this is a good watch...
By
Crnr2Crnr ·
