The Debts that Bind Us: A Comparison of Amazonian Debt-Peonage and U.S. Mortgage Practices

摘要

Three years after the global financial crisis started academic and popular pub-nlications assessing its origins, consequences and wider implications are startingnto emerge. The origins of the crisis are generally explained as stemming fromnthe rapid increase in subprime mortgage lending in the United States and thencredit default swaps banks and other financial institutions traded amongst them-nselves based on these loans. As homeowners found it increasingly difficult tonmake their repayments and housing prices in the United States started tondrop, a downward spiral ensued. In this cycle ever-growing numbers of home-nowners defaulted on their mortgages, unable to meet interest payments or tonre-mortgage, and banks foreclosed on the houses even as their own assetsnand investments were exposed to the losses stemming from defaulted mort-ngages. With the foreclosures devaluing house prices further and the exposurenof banks making them less willing and able to refinance mortgages, the situ-nation quickly spiraled downwards. The complex global trade in credit defaultnswaps and other derivatives meant that the problems were amplified andnspread beyond the United States until ultimately many national governmentsndecided to intervene with financial assistance mainly aimed at the financialninstitutions.