Historical Events

Previously, the SNB had been pegging the Swiss Franc to the Euro at a fixed rate, with a floor of 1.20 EUR/CHF. This policy had been in place for several years. However, the SNB's announcement to abandon this peg caused a dramatic and sudden surge in the value of the Swiss Franc. The exchange rate of the Euro to the Swiss Franc collapsed, leading to significant losses for many traders, investors, and financial institutions.

The Euro/CHF crash had widespread implications, and it was a highly significant event in the world of foreign exchange markets. It highlighted the risks associated with central bank policy changes and the potential for extreme market volatility in currency trading.

Key aspects of the Enron scandal included: Accounting Fraud, Off-Balance-Sheet Accounting, Stock Price Manipulation, Document Shredding, and Bankruptcy.

The scandal had far-reaching consequences, including the dissolution of Arthur Andersen, one of the "Big Five" accounting firms at the time, which was accused of negligence in its auditing of Enron's financial statements.

The Enron scandal exposed major flaws in corporate governance, accounting, and oversight in the United States. It led to significant regulatory changes, including the Sarbanes-Oxley Act of 2002, which aimed to increase transparency and accountability in corporate financial reporting. Several Enron executives, including CEO Jeffrey Skilling and Chairman Kenneth Lay, were prosecuted and convicted for their roles in the scandal.

The 2007-2008 housing market crash, often referred to as the "housing bubble burst" or the "subprime mortgage crisis," was a significant financial and economic crisis that had far-reaching consequences. Here is an overview of what happened:

Housing Bubble: In the years leading up to the crisis, the United States experienced a housing bubble. Housing prices had been steadily rising for years, driven by factors such as low interest rates, speculative buying, and relaxed lending standards.

Subprime Mortgages: Many lenders were offering subprime mortgages, which are loans made to borrowers with poor credit histories. These loans often had adjustable interest rates, which meant that borrowers faced increasing mortgage payments as rates rose.

Securitization: Lenders bundled these subprime mortgages into complex financial products known as mortgage-backed securities (MBS). These MBS were then sold to investors around the world.

Risky Financial Products: Financial institutions also created and sold complex derivatives and other financial instruments related to these MBS, further spreading the risk throughout the financial system.

Housing Market Downturn: As housing prices started to decline in 2007, many homeowners found themselves unable to refinance their mortgages or sell their homes. This led to a surge in mortgage defaults and foreclosures.

Financial Institution Failures: As the value of mortgage-backed securities and other financial products tied to the housing market plummeted, many financial institutions faced severe losses. Some major banks and investment firms, like Lehman Brothers, Bear Stearns, and AIG, were on the brink of collapse.

Global Financial Crisis: The crisis in the housing market had a domino effect on the broader financial system. The interconnectedness of global financial institutions meant that the crisis quickly spread worldwide, causing a global financial crisis.

Government Interventions: To prevent a complete financial collapse, governments and central banks took various measures, including bailouts, stimulus packages, and emergency interest rate cuts.

Recession: The crisis led to a severe recession in the United States and other parts of the world. The recession resulted in job losses, home foreclosures, and significant economic hardship for many individuals and families.