On September 7th, 2008, the United States Treasury announced that the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation, popularly known as Fannie Mae and Freddie Mac, were place into conservatorship. In short, both institutions were unable to fulfil their obligations and were therefore technically in default. One week later on September 15th, one of the largest and most successful investment banks in the world, Lehman Brothers, filed for bankruptcy in the Southern District Bankruptcy Court of New York.
It is now ten years since those events, which triggered the most profound financial and economic crisis ever. At the time I was a relatively experienced finance professor and had probably educated some of the culprits, and certainly many of the victims, of the crises that ensued. Ten years later, our world has changed: investment banks do not exist in the form they used to; there is more, and better, regulation; the financial market landscape has changed dramatically, in terms of both players and behaviors; a few countries have defaulted.
