【正文】 lose confidence in the economy. Because we insure many many things. And so the government have a meeting and they came out at the weekend, they said well we think Lehman brothers can go away, its ok, they collapsed, but AIG insurance pany here we give you many billion of dollars and you have to agree to a certain number of rules and you couldn’t say a lot. So let’s call back 50% of the policy two panies two big big panies about to go bankrupt and the government says one of you can save and one of you can die. And then since then many many panies realize they are also in trouble the same things that brought down those panies which the minute and then now the stock market going down down, up a little bit and then down and down. So now the stock market is about 9000 so it was very high then for a long time reaching 12,000 and now 9,000, again I would e back to this later on and say that’s not really very low, but it seems very low, and television love this, they say the US lost 30% of the ware overnight because when went from 14% now to 9,000, the television’s mathematics might not be good, they call that 30% and all the housing stock of the US is going down and down. The American is pouring its homeless people from all the streets, its terrible, so it means I borrow money, I borrow money to buy the house and the bank will lend you money and we have a claim on your house, if few can pay the money back we have your house pay back, actually the bank doesn’t want to own the house, and it’s terrible selling the houses, but want to threaten people you had better pay off and if you don’t pay back you are a loser now, so I don’t know anybody who is lost the house, in our Chicago maybe 500 people have lost their houses more than before, it’s very very small, but in some part of the country it is much bigger, maybe 5%, in Florida and California. Many people have mortgages in their house, 50% of the house now the owners own the house. Of another 50%, maybe 5% of them are in danger, so it’s not a huge number, but this is significant small number, maybe I think the number is 12 million, 100 million own some danger. Ok ,but people say it is a big crisis, it is getting worse, and you know the same things happen in New York, and Japan is in crisis for 25 years already, it has a big down and now it maybe a little up. So the question we want to answer first is how this trouble e down and what rules we will plan and then why the crisis suddenly now and what can the government do for that ,that’s the first thing we need to understand. Ok ,all right. Next is, so this is the general description of how the crisis e from and its all about housing, why? Because we all stay in countries especially the US and it is easy to borrow money. If you go to a bank say I want to borrow money to go to the university of Chicago law school, the bank will say sure we lend you money cause students want, and you know the university is expensive but it is also very very easy to borrow money to go to university. Several reasons, one is the very very very good if you go to a great university, even you go to a bad university, the rate of return is about 15%, people go to university e back from university, they make more money than before he is able to pay back the money. Also there is interesting legal rule that is if not allowed to go to university, borrow money finishing university and say I have no money I go bankrupt. You can go bankrupt in US and start all over again for almost anything, but not students alone, students alone survive bankruptcy with that interesting law, many people borrow money and they go bankruptcy, therefore the risk of students start going down. So good students start to plain the university start to plain that’s terrible .That’s one way you can borrow money. The other way most people can borrow money is by buying house, so they go house and the house seller say 100,000 dollars, or maybe from their family or from their job, they have 20,000 dollars, they go to the bank say I need 80,000 or 90,000 dollars to buy the house, why don’t you buy the house? The bank says we don’t want to own a house, we will lend you money and you take mortgages and pay the money back after 13 % interest rate per year and after 13 or 15 years you will own the house pletely, so why how often the bank is where is the bank of money e from, well you probably know the bank maybe has the money from the public, the bank has millions of dollars, say the bank has 80,000 dollars, and any people can borrow 80,000 dollars, how the bank have the money to pay 10 people to buy the house, but as you know the law has let the bank lent more much much money , the bank has 80,000 dollars but it is unlikely all the people go bankrupt, most people will pay back the money, so we expect the bank to lend us 80,000 dollars, the bank lends the money depending on what country you e from and so on, maybe 8,000,000 dollars, so the bank ran out many many mortgages to depending on the money they have in the bank and this is regulated by law. We can think a minute about what will happen if there is no law, the law allowed the bank to leverage the money they have and lend out much much money back. So the two problems came back, one problem is the bank really care about who they lent the money to, we look at the money carefully, we look at the house, you can do survey, make sure the house is well built, because the bank will the house if the person doesn’t pay the mortgage back, but overtime ,banks want to diversify, they will have the mortgage say not so good to lend money to everybody living in one neighborhood, people can pay the loan back, so bank is selling each other mortgages to all the countries all over the world, so every bank can diversify if you lend money to buy the house, please take that mortgage and shares with the banks all over the country, so really the bank doesn’t care if you are so good or not good,