Negligent Oversight Phase (2005-2008)

Rajan (Pivotal moment #1)

Aug 1, 2005

Rajan Delivers Paper at Federal Reserve Conference

Negligent Oversight Phase

Period: Aug 1, 2005 to Sep 15, 2008

Hudge Funds

Jun 1, 2006

Hudge Funds Short The CMO Market

Goldman Sachs (Pivotal moment #2)

Dec 1, 2006

Goldman Sachs Shorts the CMO Market

Bear Stearns (Pivotal moment #3)

Jul 1, 2007

Bear Stearns Hedge CMO Fund Collapses

BNP Paribas

Aug 9, 2007

BNP Paribas Suspends Withdrawals Form CMO Fund

Bear Stearns

Mar 1, 2008

Bear Stearns Collapses

Henry Paulson

Aug 10, 2008

"It's a safe banking system, a sound banking system. Our regulators are on top of it. This is a very manageable situation"

Lehman Brothers

Sep 15, 2008

Lehman Brothers Declares Bankruptcy and the Financial Crisis Begins