<p>“I was just clueless about why the housing market was so significant. I found out.”</p>
<p>It isn’t that significant.</p>
<p>The problem was the financial institutions that over bet on the housing market and poorly-crafted financial instruments. And keeping investors out of the loop of the firm’s exposure. Now that the housing market has suffered, investors are realizing these weren’t the great investments they thought they were. Everyone is running away from them and any one who is or may be (many we don’t know - they were held off the books) exposed to them. The result is a scared ill-liquid financial market.</p>