CNNMoney, September 13, 2018: 10 years after the financial crisis, have we learned anything?
When John Taylor starts remembering the years leading up to the financial crisis, his fury wells up all over again.
As president of the nonprofit National Community Reinvestment Coalition, he warned Congress about the predatory and fraudulent lending that was fueling a housing bubble as early as 2000. Lawmakers told the Federal Reserve to write rules that would have put a stop to the worst practices. But the crash came first.
“Thinking about it now, I can feel myself being angry about it,” says Taylor, in a soft accent left over from his upbringing in the housing projects of Boston. “Because we fought when we saw these things happening. We brought it to the attention of both Democrats and Republicans. In the end, it took the nation’s economy having to collapse before they felt the need to do something.”
The mounting crisis turned into a full-blown crash nearly 10 years ago, when Lehman Brothers filed for the largest bankruptcy in United States history on September 15, 2008. Stuffed to the gills with bad mortgages, it sustained heavy losses as housing prices dropped, and imploded after multiple acquisition deals fell through.
The collapse set off a chain reaction of bank failures that required unprecedented federal action to unwind.
Now, with a buoyant economy finally starting to lift some of the United States’ most depressed pockets, CNNMoney is taking a look back at the decade following the financial meltdown — and the signs that something similar might again be on the horizon, as Congress and regulators begin to loosen some of the rules they put in place to fix and prevent the problems.
“We’re sitting here, 10 years later, with a short-term memory that doesn’t seem to recall how we got into that mess,” Taylor says. “We got into that mess because of the lack of regulation, and now we’re talking about making banks less accountable. It makes no sense whatsoever.”
