Meltdown

Frontline looks into what caused one of the greatest economic crises in history and the ways in which the government reacted and responded. The film details the inside scoop on Bear Stearns deal, the bailout of AIG to the tune of 700 billion dollars, and the collapse of the Lehman Brothers. I watched a number of videos, one of them being "Inside the Meltdown," the first video of the Frontline series as produced by Michael Kirk. The video is quite interesting and does a great job at introducing the viewer to the characters and giving him or her a sense of how things are set up and the structure of the narrative. It therefore does not go into great detail explaining the intricate pieces but lays the ground work for the series and gives the viewer a sense of the direction of the drama (C2, 2010).

On Thursday, September 18, 2008, leaders of the U.S. Congress were gathered for a private session where they were to be briefed by the Federal Reserve chairman. The chairman told the shocked leadership that the U.S. economy was on the verge of a serious meltdown and things were probably going to take a nose... A sudden pause fell upon the room, almost as if oxygen had been sucked off it, remembers Sen. Christopher Dodd (D-Conn.) (TPF, 2009).
With the housing bubble bursting and trillions of dollars in mortgages beginning to go bad in the year 2007, fear began to spread through the big firms that are the heartbeat of Wall Street. By spring 2008, with billions worth of bad mortgages on their back, Bear Stearns -- an investment bank -- was rumored to be near collapse. The problem with such kind of rumors is that they can put so much strain on a financial institution that they get to bust. The financial markets had become volatile and no company wanted to be on the receiving end of disconcerting rumors. It didn't help that Bear Stearns was already in bad shape. The company's stock shed most of its value as it dropped to $57 down from $171 a share. The financial devaluation of the bank was indicative of two things: it was on the verge of bankruptcy and it was quickly becoming a toxic asset. A toxic asset is basically when a financial asset or institution loses its financial value, and the…