You Can't Make This Stuff Up

Did you hear the one about the sheep beauty pageant held for the men of Saudi Arabia?

Subprime Time

I heard this story on the way home from work today. It's probably the best summary of the whole subprime mortgage debacle that I've heard or read anywhere. It's a tale of the perverse incentives that drove subprime mortgage brokers to steer clients into risky loans and how borrowers either deceived themselves or were deceived by their brokers (or both) into thinking they could afford the loans that they were taking out. It's a seven-and-a-half minute object lesson in behavior economics.