A Short Timeline of the 2007 to 2009 Financial Crisis
The global financial crisis unfolded over several years, and people often compress it into one date or one name. This timeline lays out the broad sequence so that the references in a game like Collapse! make more sense. It deliberately sticks to well-known events and avoids detailed figures.
Before the crisis
In the early 2000s, home prices in the United States rose strongly and credit was easy to obtain. Lenders made many mortgages to borrowers with limited ability to repay, often called subprime loans. These loans were then bundled into securities and sold to investors around the world, which spread the risk well beyond the original lenders.
2007: the first cracks
As housing prices stopped rising and interest rates adjusted on many mortgages, defaults grew. Securities backed by those mortgages lost value, and financial firms that held them began to report losses. Banks became unwilling to lend to each other, because nobody was sure which institutions were exposed. This freezing of credit between banks is one of the clearest signs that the problem had moved from housing to the financial system as a whole.
2008: rescues and failures
In March 2008 the investment bank Bear Stearns, short of funds and losing the confidence of its lenders, was sold to JPMorgan Chase with the support of the Federal Reserve. In September of that year the pace quickened. The federal housing finance companies Fannie Mae and Freddie Mac were placed under government control, Lehman Brothers filed for bankruptcy, and the insurer AIG received emergency government support. Money market funds came under pressure and markets in many countries fell sharply.
Governments responded with large rescue programmes. In the United States, Congress approved a major financial rescue package in October 2008, and other countries guaranteed bank deposits or injected capital into their banks.
2009: recession and recovery efforts
The financial shock spread into the wider economy. Unemployment rose, trade slowed and many economies entered recession. Central banks cut interest rates to very low levels and used unconventional measures to support lending. Stock markets began to recover during 2009, but the aftermath, including debt, regulation and arguments about responsibility, continued for years.
Why there is no single villain
It is tempting to ask who caused the crisis. Candidates include lenders who made risky loans, firms that packaged and sold complicated securities, rating agencies, regulators, governments, and borrowers and investors who took on more risk than they understood. Most analysts agree that these factors interacted. The Collapse! game reflects this view by giving each block a different cause, so that the tower falls for a reason that depends on the players’ moves.
Related reading
To understand two of the most-cited products in the story, see CDS and CDOs explained. For the policy debate that followed the rescues, read what “too big to fail” means. The home page describes the game itself.
A note on sources
Dates and sequences in this timeline are widely reported, but exact figures, such as the size of losses or rescue packages, differ between sources and depend on how they are counted. For precise numbers, consult official central bank and government publications. The aim here is to provide a framework for understanding the game, not a complete history.