Stock markets plunge!
This isn’t your typical crash recap. Instead of just replaying the headlines—Lehman Brothers collapses! Bailouts! Stock markets plunge!—we’re diving into the financial plumbing, the early warning signs, and the key metrics that were flashing red long before the world noticed.
Most people (even experts) didn’t see the 2008 financial crisis coming—not because there weren’t clues, but because they weren’t looking in the right places. This series breaks down the underappreciated indicators and technical red flags that were hiding in plain sight.
1. Repo Markets & Liquidity Freeze
How the quiet breakdown of trust in overnight lending markets set off a massive liquidity crisis.
2. LIBOR-OIS Spread: The Silent Alarm
This obscure but powerful signal told us banks no longer trusted each other.
3. CDS Spreads: When Insurance Got Expensive
Credit default swaps on major institutions were screaming trouble—months before they failed.
4. The Rise (and Fall) of Shadow Banking
Meet the unregulated entities carrying systemic risk—hedge funds, SIVs, and other time bombs.
5. Leverage & the House of Cards
When banks borrowed $30 for every $1 they had, even a small tremor was enough to bring down giants.
Why This Still Matters Today
These signals didn’t just matter in 2008—they’re still used by pros to detect financial stress today.
Many of the same structural weaknesses still exist, just in different forms (think private credit, crypto leverage, or shadow lending in Asia).
If you want to be better prepared for the next crisis, these are the signals to watch
