Credit Crunch Chronology: April 2007–September 2009

The global financial crisis that began in mid-2007 and exploded in the fall of 2008 shocked most economists. Some had raised concerns about the rapid growth in the housing market in developed countries, especially to “sub-prime,” high-risk borrowers. Others had been concerned about large banks being “Too Big to Fail,” worrying that such banks might take inordinate risk since they had an implicit government backstop. But the typical economist–even the typical macroeconomic forecaster–was not predicting a massive global recession over the 2007–2008 period. Thus, the crisis was a genuine surprise.While economists have theories to help explain and understand recessions, bubbles, manias and crashes, only by taking these theories to the data will we learn which models are relevant and which are mere theoretical curiosities. The chronology below should help refresh reader’s memories about the world-shaking events surrounding the crisis while also reminding them of some of less-famous but possibly still crucial moments from the 2007 to 2009 period. Many of the events, institutions, and concepts below are discussed in full-length articles elsewhere in the Dictionary.