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Banks collapsed, asset prices plunged, currencies came under attack and their value fell.
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Earnings and returns collapsed, assets written down and debt mushroomed.
Forced selling, collapsing asset prices and evaporating balance sheets are turning a financial crisis into a deep depression".
But although they may lose their jobs and default on their loans, they will not be troubled by collapsing asset prices because they do not own assets.
The lesson of Japan in the 1990s is that once economies get sucked into a vicious circle of collapsing asset prices, banking crises and deflation it takes a lot of time and a lot of pain to escape from them.
The global financial crisis precipitated in 2007 and 2008 shared some of the key features exhibited by the wave of international financial crises in the 1990s, including accelerated capital influxes, weak regulatory frameworks, relaxed monetary policies, herd behavior during investment bubbles, collapsing asset prices, and massive deleveraging.
Collapsing asset prices, including unprecedented drops in the value of housing, Americans' biggest financial asset, meant that three-fifths of households in America saw their wealth decline between 2007 and 2009.
When Iceland's banks collapsed, their assets were 880% of Iceland's GDP.
By way of comparison, when Lehman Brothers collapsed its assets were only worth about 5% of American GDP.These three banks had lent excessively and recklessly.
When the markets collapsed, these assets threatened to come back onto the balance-sheets, a prime cause of today's problems.It would be a mistake to argue that, had politicians rather than bankers been in charge, policy would have been more prudent.
When a company collapses, the assets of its 401(k) are to be transferred to account holders — promptly.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com