![]() ![]() Congress had passed legislation encouraging financing for affordable housing. The preconditions for the financial crisis were complex and multi-causal. Financial institutions worldwide suffered severe damage, reaching a climax with the bankruptcy of Lehman Brothers on September 15, 2008, and a subsequent international banking crisis. ![]() Predatory lending targeting low-income homebuyers, excessive risk-taking by global financial institutions, and the bursting of the United States housing bubble culminated in a " perfect storm." Mortgage-backed securities (MBS) tied to American real estate, as well as a vast web of derivatives linked to those MBS, collapsed in value. It was the most serious financial crisis since the Great Depression (1929). The financial crisis of 2007–2008, or Global Financial Crisis ( GFC), was a severe worldwide economic crisis that occurred in the early 21st century.
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