Part 5/8:
The early 2000s witnessed a return to risky betting, this time through the housing market. After the dot-com bubble burst, investors gravitated towards real estate, leading to a surge in mortgage-backed securities. As demand soared, lenders relaxed mortgage requirements, giving rise to a new category of risky loans known as subprime mortgages.
When housing prices eventually fell, it initiated a catastrophic chain reaction. Defaults on loans led to foreclosures, resulting in the collapse of financial institutions and massive government bailouts reminiscent of the Great Depression. Once again, reckless speculation caused widespread havoc on the economy, raising questions about accountability and foresight.