House of Cards

Image: A house made of playing cards, seems stable at first glance, but it would only take a sneeze to bring it down!

The financial crisis was started by Wall Street financing companies whom were selling housing loans based on the high and ever-rising house prices. The high prices gave people too much equity, and creates, in financial terms, a house of cards. There were no further financial checks carried out and no company wanted to do more thorough checks in fear of becoming less competitive than other companies. Worse than this, some companies in the U.S. were cheating by rating the Collaterized Debt Obligations (CDOs) for loans too highly. The agencies doing the rating got more business if they offered more favourable ratings. This is because more of their customers, whom are the lending agencies, will go to the CDO loan rating that gives a higher average rating.

All companies took the same short-sighted greedy approach. I would like to ask why was the greed of a few allowed to devastate the lives of so many?


Protests this week in London for the G20 summit were important to express peoples' feelings. Here are some more images of the protests (click on an image for the link back to the original source).

World leaders from the G20 countries met in London to discuss what can be done for the worst world recession in 80 years, see some of the leaders pictured below.

French President Mr Sarkozy wants greater and tighter regulation on the financial markets as they have proved they cannot self-regulate effectively.

Perhaps, Capitalism, given a free reign, is not the way to go? From this economic crisis, we can see that, in the same way that Barack Obama believes the political world needs transparency and accountability, for the financial structures there is also clearly a need for transparency, integrity and accountability, supported by appropriate policy and regulation.

Sources: CNBC listened to 16.2.09, 'house of cards'. Aljazeera News Hour 1st-3rd/4/09; Aljazeera World News Website, the2009g20londonsummit, accessed 4.4.09