To state the obvious: economics has been very topical and something that everyone now has an opinion about. Unfortunately few people seem to have an educated opinion about what the various economic terms mean, why the economics collapsed and why this will doubtlessly recur again and again in the future.

Well I'm not going to offer much of my own reasoning here but rather provide some youtube links to a guy that clearly explains the various economic terms. He doesn't pass judgement on the bankers or fund managers but rather explains the implications of their actions. I believe he allows you to draw your own conclusions so he gets my thumbs up.

Paddy Hirsh is a senior economics reporter for marketplace.org, he was born in Dundee (Scotland) but now resides in California. He has quite a few videos online so do spend time perusing the other ones that I haven't linked here:

A look inside hedge funds:

http://www.youtube.com/watch?v=ksLySMWRwLs

Leveraging and Deleveraging:

http://www.youtube.com/watch?v=vKp-HGfT1SQ

Untangling credit default swaps:

http://www.youtube.com/watch?v=KhI5qy-L4cc

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AlwaysThinking  - False economy   |2009-05-30 12:10:31 The collapse of the banks happened because we are  using a false economy. Money is not equal to weal th, and so we were creating money - in the form of  stocks and shares - but not creating wealth. The  housing market was another example: new homes wer e being built which were realistically woth maybe  £100k, however due to demand and the fact they are  seen as an investment they were selling for much  more. Banks were allowing too many buyers to take  out mortgages they could not afford... When these  properties were repossessed they were not worth w hat the banks thought they were worth, and so a lo t of the banks had less money than then thought th ey did. The reason the UK will be hit hardest is  simple: we have no industries. Our last two gover nments have made sure of that. Without industry,  and real wealth, to back up our money we are always going  to be economically unstable. Reply | Quote 0 0

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