WEBVTT - How Mortgage-backed Securities Work

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<v Speaker 1>Brought to you by the reinvented two thousand twelve camera.

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<v Speaker 1>It's ready. Are you welcome to Stuff you should know

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<v Speaker 1>from how stuff works dot Com? Welcome to the podcast

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<v Speaker 1>located from deep within the bowels of how stuff Works

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<v Speaker 1>dot Com headquarters. It's Josh and Chuck. Chuck. That makes

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<v Speaker 1>it sound really fancy or creepy or something. I don't know.

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<v Speaker 1>I like it. I was going for creepy. Okay, I'll

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<v Speaker 1>take it. It didn't work. I'm creepy out. Yeah, okay, Chuck.

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<v Speaker 1>Did you look out the window today at all? I have?

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<v Speaker 1>Did you did you notice that everything is spinning very

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<v Speaker 1>quickly clockwise? I have? Yeah. Do you know what that is?

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<v Speaker 1>A downward spiral? It is. It's the US economy circling

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<v Speaker 1>the drain very quickly and taking the entire nation with it.

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<v Speaker 1>It's pretty bad. Have you heard about this economic downturn? Yeah?

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<v Speaker 1>I mean you can't miss it, man, It's everywhere it is.

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<v Speaker 1>It is popping up everywhere. Um. Huge investment banks that

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<v Speaker 1>did whether the depression are starting to go under. Um.

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<v Speaker 1>You know, there's there's all sorts of financial groups that

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<v Speaker 1>are suffering as well. A i G. The largest insurance

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<v Speaker 1>company in the United States who ensures all these people

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<v Speaker 1>is going under right, Well, now it's owned by the

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<v Speaker 1>government almost completely. Yeah, we well, uh, eight percent stake

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<v Speaker 1>seventy nine point nine percent stake is owned by the

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<v Speaker 1>federal government, owned by you and I we own we

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<v Speaker 1>own part of that. I feel it. I feel it inout.

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<v Speaker 1>I know, did you feel richer? I know if you're

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<v Speaker 1>wearing your top hat and monocle today very appropriately. Um,

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<v Speaker 1>So all of this stuff is going on. Yeah, it's

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<v Speaker 1>impossible to miss it. The crazy thing is that all

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<v Speaker 1>of it can be traced back to a single thing,

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<v Speaker 1>a single investment instrument that caused all of this problem.

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<v Speaker 1>And I was happy to learn this. Do you you

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<v Speaker 1>know what it is? Yeah, I'll go ahead, and it's

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<v Speaker 1>called a mortgage backed security. And you're kind of the expert.

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<v Speaker 1>I want to go ahead and preface this by saying

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<v Speaker 1>that Josh wrote these articles, and uh, I'm an economic

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<v Speaker 1>idiot basically. So I learned a lot by reading them,

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<v Speaker 1>and hopefully people will learn a lot by listening. Oh,

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<v Speaker 1>I learned a lot by writing them. So if people

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<v Speaker 1>if people learn a lot listening, then it will be

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<v Speaker 1>a trifecta. Everyone will have learned. So yeah, what we're

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<v Speaker 1>talking about today are subprime mortgage backed securities. There's different kinds.

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<v Speaker 1>Some more mortgage backed securities are are worse than others,

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<v Speaker 1>and the worst of the bunch or subprime mortgage backed security, Well,

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<v Speaker 1>go ahead, and I think the the raw definition probably

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<v Speaker 1>would get people interest right off the bat. So basically

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<v Speaker 1>what it is is a mortgage backed security is an

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<v Speaker 1>investment tool that is based on a pool of mortgages.

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<v Speaker 1>So you take Chuck's mortgage and our producer Jerry's mortgage,

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<v Speaker 1>and you know, everybody at how stuff works mortgages, you

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<v Speaker 1>pull them together and then you divvy them up into

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<v Speaker 1>basically shares of all this this one single pool of mortgages.

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<v Speaker 1>And as long as everybody like Jerry and you, Chuck

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<v Speaker 1>are are paying UH on your monthly your monthly mortgage payments,

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<v Speaker 1>everything's fine right there. Like dividends, it gets distributed across

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<v Speaker 1>the shareholders of this pool of mortgages and everybody's happy, right. Well,

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<v Speaker 1>who are the shareholders though, they're the people who bought

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<v Speaker 1>uh these mortgage backed securities which are banks larger than

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<v Speaker 1>the banks. It can be anybody, it can be anyvidy, Yeah,

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<v Speaker 1>what you're talking about is the process of how this works.

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<v Speaker 1>So that what I just said, that's a that's a

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<v Speaker 1>mortgage backed security. You could purchase a mortgage backed security,

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<v Speaker 1>no way you if you wanted to, you could, and actually,

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<v Speaker 1>ironically enough, um, because these mortgage backed securities are based

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<v Speaker 1>on mortgages, and because they've been so divided up and

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<v Speaker 1>repackaged and repurposed. Will get to that in a little bit. Um,

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<v Speaker 1>it's actually possible that if you have like a four

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<v Speaker 1>oh one K, or you invest in a mutual fund

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<v Speaker 1>or something like that, you may actually own a share

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<v Speaker 1>of your own mortgage. Right. I couldn't at that in

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<v Speaker 1>your article and I was blown away. Isn't they cool?

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<v Speaker 1>That cool? I don't know if the if the economies

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<v Speaker 1>in in the in the tank, then yeah, it's not good,

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<v Speaker 1>but yeah it could be cool if you're making money

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<v Speaker 1>off of your own mortgage, paying back yourself. It's positive

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<v Speaker 1>about luck kind of. Yeah. So what you just mentioned, Chuck,

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<v Speaker 1>is is how a mortgage becomes a mortgage backed security.

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<v Speaker 1>So say you go in and you you get a mortgage,

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<v Speaker 1>you go through all the rigamar role and they issue

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<v Speaker 1>you a mortgage. The bank when mortgage backed securities were hot,

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<v Speaker 1>would turn around, put it together with you know, several

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<v Speaker 1>other of their mortgages that they'd issued that day, and

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<v Speaker 1>turn around and they sell it to UM an investment bank. Right, Okay,

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<v Speaker 1>an investment bank takes the your bank's mortgages and some

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<v Speaker 1>other banks mortages and pulls them together. Even more so,

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<v Speaker 1>now you have several hundred different mortgages and all of

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<v Speaker 1>a sudden, it's a single UM mortgage back security. Right.

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<v Speaker 1>And then they start selling shares. The investment banks starts

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<v Speaker 1>selling shares, and then the investors, your your your mutual

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<v Speaker 1>fund manager or somebody at JP Morgan Chase who who's

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<v Speaker 1>looking for an investment, they buy these shares and they

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<v Speaker 1>start collecting the dividends. So that's how it works, right, Okay.

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<v Speaker 1>It's actually a lot simpler than I thought. It's very

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<v Speaker 1>very simple, Like if you look at it, just uh

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<v Speaker 1>just it's a very basic method of investing. But it

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<v Speaker 1>was completely totally radical when it came about. I think

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<v Speaker 1>it was the late nineties when they first really hit

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<v Speaker 1>the scene, maybe early twenty first century. And here's the thing.

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<v Speaker 1>It's a really safe way to invest as long as

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<v Speaker 1>you know the housing markets going well. Uh, the economy

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<v Speaker 1>is doing well, and people are making their monthly mortgage payment.

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<v Speaker 1>There were rich times there for about a decade, probably

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<v Speaker 1>right in the housing and it was it was based

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<v Speaker 1>on that that housing Uh, that housing boom was keeping

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<v Speaker 1>mortgage backed securities. Uh, it was making them perform well.

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<v Speaker 1>So because of that, because the interplay between the housing

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<v Speaker 1>market and mortgage backed securities, mortgage backed security has become

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<v Speaker 1>this hot commodity on Wall Street. Everybody's buying, everybody wants them.

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<v Speaker 1>They're just great. It's money in the bank, right. The

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<v Speaker 1>problem is is that demand created a situation where we

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<v Speaker 1>needed more mortgages. So I mean basically, say you know

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<v Speaker 1>you're a good prime borrower. Uh, you're somebody who you know,

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<v Speaker 1>based on your credit rating, your credit history, your employment history,

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<v Speaker 1>that kind of thing, you pose little risk of defaulting

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<v Speaker 1>on your loan. There's a finite amount of prime borrowers

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<v Speaker 1>in the United States. And after a couple of years

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<v Speaker 1>with you know, with the mortgages being pulled together and

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<v Speaker 1>put into mortgage backed securities, UM, this pool of people

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<v Speaker 1>dried up. And then I know what came next was

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<v Speaker 1>the sub prime market, which is the big reason why

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<v Speaker 1>the housing boom, uh, the bubble burst exactly because subprime borrowers.

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<v Speaker 1>A lot of people think that subprime is uh has

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<v Speaker 1>something to do with the rate, the interest rate. It's

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<v Speaker 1>a below prime rate, That's what I always thought as well.

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<v Speaker 1>But no, it refers to the barrow exactly, as people

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<v Speaker 1>that don't have enough income or the right credit. Basically,

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<v Speaker 1>they were just writing things. Uh. You know, it's kind

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<v Speaker 1>of like a blank check, a false market almost very much,

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<v Speaker 1>very much so. But when banks change their lending practices

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<v Speaker 1>to include subprime borrowers, all of a sudden, there's this

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<v Speaker 1>huge untapped pool of people who can create mortgage backed

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<v Speaker 1>securities because you can't have mortgage backed securities without mortgages.

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<v Speaker 1>So basically, to answer this clamoring for more mortgage backed

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<v Speaker 1>securities on Wall Street, UH, banks had to uh start

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<v Speaker 1>issuing more mortgages, and the investment banks were more than

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<v Speaker 1>willing to buy all these mortgages no matter what. Right,

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<v Speaker 1>So your local bank you go to say you're a

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<v Speaker 1>sub prime barrowerk. And subprime has this really evil connotation

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<v Speaker 1>here in two thousand and eight, but but really, if

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<v Speaker 1>you think about it's just somebody who has a credit

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<v Speaker 1>score maybe below. I think right now it's six thirty.

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<v Speaker 1>It could be six nine. When you're a subprime barrower,

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<v Speaker 1>or maybe you've even changed jobs in the last year,

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<v Speaker 1>they could make you a subprime bar There's there's a

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<v Speaker 1>lot of factors. It doesn't mean like you're this um

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<v Speaker 1>you know, nefarious drug dealing cat burglar. You're not taking

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<v Speaker 1>the bank, drawing the welfare checks and swindling houses out

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<v Speaker 1>of banks, exactly right. Um, necessarily, some some have, but

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<v Speaker 1>for the most part, it's you can't really categorize these

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<v Speaker 1>people beyond their credit score. UM, so the banks since

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<v Speaker 1>they're no longer hanging onto the mortgage. You know, time

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<v Speaker 1>was you went to a bank. You've got a mortgage

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<v Speaker 1>that sat in the bank's vault, that piece of paper

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<v Speaker 1>did and you made monthly payments to the bank and

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<v Speaker 1>they took it in. And then after thirty years or whatever,

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<v Speaker 1>you paid your last you made your last payment and

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<v Speaker 1>they sent your mortgage and they were they did a

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<v Speaker 1>lot of investigating into your history at that time because

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<v Speaker 1>they were the ones, you know, that had the most

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<v Speaker 1>to lose. They were carrying all the risks. If you

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<v Speaker 1>defaulted on your loan, that bank took the hit and

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<v Speaker 1>that was it ended there right. Um, with with the

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<v Speaker 1>subprime or with the mortgage backed securities, that all changed.

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<v Speaker 1>Banks no longer had any risk whatsoever. They would almost

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<v Speaker 1>literally issue you a mortgage and possibly that same day,

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<v Speaker 1>turn around and sell it. That really explains it right

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<v Speaker 1>there in a nutshell. So whoever ended up with this

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<v Speaker 1>mortgage in whatever form, whether it was a mortgage backed

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<v Speaker 1>security and it was divided among like fifty or a

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<v Speaker 1>hundred or a thousand people, um, whoever ended up with

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<v Speaker 1>it in the end assumed the risk. So these investment

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<v Speaker 1>banks didn't necessarily carry the risk either. The risk of

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<v Speaker 1>you not paying your loan went to the individual investors. Right,

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<v Speaker 1>Since all all these mortgages started to become based on

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<v Speaker 1>subprime mortgages, all all the mortgage backed securities became based

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<v Speaker 1>on subprime mortgages. When the foreclosure started, the market almost

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<v Speaker 1>immediately plummeted, right because it was directly tied. Yeah, it

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<v Speaker 1>wasn't a trickle down effect. That were directly linked. There

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<v Speaker 1>is another instrument too that we're based on mortgage backed securities. Right,

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<v Speaker 1>So think about this. You have a mortgage, it's turned

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<v Speaker 1>around and sold packaged with some other mortgages and then

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<v Speaker 1>divided into shares. Those shares can actually be divided further

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<v Speaker 1>and repackaged into something called collateral debt obligations. And some

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<v Speaker 1>of these these can be based on all sorts of

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<v Speaker 1>different things. You can take just mortgage mortgages from a

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<v Speaker 1>mortgage backed security and that will all mature in five years,

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<v Speaker 1>or that are all interest only, or that are all

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<v Speaker 1>fixed interests. There's all sorts of ways to package it.

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<v Speaker 1>But one of the hottest items on Wall Street for

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<v Speaker 1>collateral debt obligations were these, uh these instruments that were

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<v Speaker 1>made exclusively from subprime mortgage backed securities. Because you're a

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<v Speaker 1>subprime borrow where you get a higher interest rate, So

0:11:15.360 --> 0:11:18.800
<v Speaker 1>the security the investment on whether or not you're gonna

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<v Speaker 1>pay your loan. It's riskier, but the dividends are higher

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<v Speaker 1>because the interest rate is high. Sure and not unlike

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<v Speaker 1>a lot of just the regular Wall Street stock market stocks,

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<v Speaker 1>great risk equals great rewards and and that that pays off.

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<v Speaker 1>But really, if you look at it long enough, arc

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<v Speaker 1>it never pays off. It always it always goes under.

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<v Speaker 1>So what you have now is is a bunch of

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<v Speaker 1>people playing playing hot potato with these things. They were

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<v Speaker 1>they short excited, They're greedy, greedy, It's as simple as that.

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<v Speaker 1>Was it a live for now type of thing that

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<v Speaker 1>they plan on dumping knees? I guess here's that's I

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<v Speaker 1>would assume, yes, that that once people started realizing, wait

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<v Speaker 1>a minute, eventually, when you follow these down the line,

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<v Speaker 1>you're going to get to a house, and that house

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<v Speaker 1>is basically its value is in this situation based on

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<v Speaker 1>whether or not the person is making payments, and we're

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<v Speaker 1>we're betting on subprime borrowers making payments, and if they don't,

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<v Speaker 1>this this security tanks and we lose all of our money.

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<v Speaker 1>Someone somewhere down the line, around say two thousand six

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<v Speaker 1>figured out that these things were going to tank because

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<v Speaker 1>of foreclosures, and that's exactly what happened. So it started

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<v Speaker 1>this domino effect. Well, who's it fault here? Or is

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<v Speaker 1>that even important? I mean, was it? Or? I guess

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<v Speaker 1>everyone kind of shares in the plane because the homeowner

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<v Speaker 1>that that really doesn't have the money shouldn't go out

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<v Speaker 1>and try to get the house. The lender certainly they

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<v Speaker 1>were making the commissions correct the mortgage brokers, so they

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<v Speaker 1>were making money and then selling them immediately, or actually

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<v Speaker 1>I think the mortgage lender it immediately goes to the bank,

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<v Speaker 1>so they're not even really tied to the bank necessarily,

0:12:56.080 --> 0:12:58.400
<v Speaker 1>and then the bank sells them. And it's just seems

0:12:58.400 --> 0:13:00.240
<v Speaker 1>like the more it gets spread out and split up,

0:13:00.559 --> 0:13:02.520
<v Speaker 1>the more fractured it gets. It's really hard to even

0:13:02.520 --> 0:13:05.640
<v Speaker 1>tell who's to blame anymore. It is. And I mean, ultimately,

0:13:06.559 --> 0:13:09.079
<v Speaker 1>you know, finding the person to blame isn't gonna help

0:13:09.120 --> 0:13:11.960
<v Speaker 1>anything now exactly, but it kind of eases the pain

0:13:12.000 --> 0:13:13.520
<v Speaker 1>a little bit, or at the very least you have

0:13:13.600 --> 0:13:15.480
<v Speaker 1>someone to direct your I or two. Well, I know,

0:13:15.559 --> 0:13:17.400
<v Speaker 1>in an election here though a lot of people are

0:13:17.400 --> 0:13:19.640
<v Speaker 1>looking at point fingers. If this is not an election year,

0:13:19.720 --> 0:13:22.240
<v Speaker 1>probably going down a little bit differently. I think, Um,

0:13:22.280 --> 0:13:24.160
<v Speaker 1>I think there's a lot of people to blame, as

0:13:24.160 --> 0:13:26.000
<v Speaker 1>you said, And I don't think it's just the lending

0:13:26.040 --> 0:13:29.960
<v Speaker 1>industry or the investment banking industry. And I don't think

0:13:29.960 --> 0:13:35.240
<v Speaker 1>it's just the people who who yeah, or the hockey

0:13:35.240 --> 0:13:37.600
<v Speaker 1>moms don't forget them right. I don't think it's it's

0:13:37.640 --> 0:13:41.880
<v Speaker 1>the average subprime barrower who took out a loan larger

0:13:41.880 --> 0:13:43.840
<v Speaker 1>than they can because they were sold a bill of goods,

0:13:43.920 --> 0:13:46.600
<v Speaker 1>oftentimes because I wrote an article on subprime mortgages and

0:13:46.760 --> 0:13:48.440
<v Speaker 1>a lot of people didn't even know what they were signing.

0:13:48.960 --> 0:13:52.199
<v Speaker 1>These mortgage lenders would kind of use tricky dialogue to

0:13:52.200 --> 0:13:53.720
<v Speaker 1>get them to sign on the dotted lines so they

0:13:53.720 --> 0:13:55.720
<v Speaker 1>could make their commissions. Yeah, there's there was a lot

0:13:55.760 --> 0:13:59.960
<v Speaker 1>of predatory lending going up big time. Um so regard

0:14:00.040 --> 0:14:03.400
<v Speaker 1>list of who's to blatant. These foreclosures start happening, and

0:14:03.440 --> 0:14:07.280
<v Speaker 1>they start happening big time, widespread, all over the place, right,

0:14:07.520 --> 0:14:10.040
<v Speaker 1>and like I said, it starts this domino effect. The

0:14:10.160 --> 0:14:14.080
<v Speaker 1>weird thing is is new houses that were being constructed

0:14:14.720 --> 0:14:17.360
<v Speaker 1>stop stop being sold as quickly because all of a

0:14:17.400 --> 0:14:20.280
<v Speaker 1>sudden they had to compete with these four closed homes

0:14:20.280 --> 0:14:23.200
<v Speaker 1>on the market exactly that were maybe half price. Yeah,

0:14:23.200 --> 0:14:25.160
<v Speaker 1>I bought my house and foreclosure. Yeah. I mean this

0:14:25.240 --> 0:14:29.160
<v Speaker 1>was even before the big, big foreclosure bust where they're

0:14:29.200 --> 0:14:31.400
<v Speaker 1>all over the place, So we just got kind of lucky.

0:14:31.480 --> 0:14:33.320
<v Speaker 1>But yeah, all of a sudden, these new houses are

0:14:33.360 --> 0:14:36.120
<v Speaker 1>sitting empty because, like you said, they can't compete with

0:14:36.120 --> 0:14:40.480
<v Speaker 1>the house that's discounted. So all these four closed homes

0:14:40.480 --> 0:14:43.120
<v Speaker 1>have this effect on the market the housing market, right,

0:14:43.480 --> 0:14:45.360
<v Speaker 1>more new homes on them or more homes on the

0:14:45.400 --> 0:14:48.000
<v Speaker 1>market means that the new homes aren't being sold because

0:14:48.000 --> 0:14:50.640
<v Speaker 1>the foreclosures are going. It's like a fire sale out

0:14:50.640 --> 0:14:53.880
<v Speaker 1>there in real estate in the US. UM but the

0:14:53.960 --> 0:14:56.520
<v Speaker 1>presence of more homes on the market, the presence of

0:14:56.560 --> 0:15:00.400
<v Speaker 1>more anything, the more supply, the lower the price. Housing

0:15:00.440 --> 0:15:03.120
<v Speaker 1>prices dropped. So you've got people all of a sudden

0:15:03.120 --> 0:15:05.240
<v Speaker 1>who are like, wait a minute, I'm in this huge

0:15:06.160 --> 0:15:12.480
<v Speaker 1>terrible UM maybe hybrid arm adjustable rate mortgage, and all

0:15:12.480 --> 0:15:14.280
<v Speaker 1>of a sudden they owe more on their house than

0:15:14.320 --> 0:15:16.960
<v Speaker 1>it's worth. How long are you gonna stick around? When

0:15:17.000 --> 0:15:19.800
<v Speaker 1>are you gonna leave and start renting? So, foreclosures keep

0:15:19.800 --> 0:15:22.760
<v Speaker 1>going and going and going. And as these this wave

0:15:22.840 --> 0:15:26.400
<v Speaker 1>of foreclosures takes over in the US housing market, it

0:15:26.800 --> 0:15:32.080
<v Speaker 1>also directly impacts the the investment market as well, because

0:15:32.360 --> 0:15:36.560
<v Speaker 1>everybody was, you know, so heavily invested in subprime mortgage

0:15:36.560 --> 0:15:39.840
<v Speaker 1>backed security. And then you have the construction companies who

0:15:39.840 --> 0:15:42.600
<v Speaker 1>own all these houses that aren't selling, so they have

0:15:42.640 --> 0:15:45.680
<v Speaker 1>to lay people off, and then it leads unemployment. It's

0:15:45.760 --> 0:15:49.480
<v Speaker 1>it's a huge domino effect. That's exactly right. Everything, Uh,

0:15:49.800 --> 0:15:53.440
<v Speaker 1>pretty much in the modern economy and the global economy

0:15:53.440 --> 0:15:57.800
<v Speaker 1>and the US economy, everything is in a related precariously so,

0:15:58.240 --> 0:16:00.600
<v Speaker 1>but it all goes back to mortgage back securities in

0:16:00.600 --> 0:16:03.040
<v Speaker 1>this case. That's exactly right. Whose idea was this to

0:16:03.040 --> 0:16:05.440
<v Speaker 1>begin with? I don't know, I've I've never found that

0:16:05.440 --> 0:16:07.600
<v Speaker 1>out and I've actually looked. I think that they are

0:16:07.760 --> 0:16:10.360
<v Speaker 1>laying low. There's got to be a dude, there's one

0:16:10.400 --> 0:16:13.160
<v Speaker 1>guy who had this idea. Yeah. Well, there's a lot

0:16:13.160 --> 0:16:15.080
<v Speaker 1>of financial instruments that are out there, and they come

0:16:15.080 --> 0:16:18.480
<v Speaker 1>out of places like Harvard Business or Wharton School and

0:16:18.840 --> 0:16:21.960
<v Speaker 1>you know, among other places, and they're modeled. You know

0:16:22.040 --> 0:16:25.320
<v Speaker 1>that you can run them through an an economic model,

0:16:25.720 --> 0:16:27.960
<v Speaker 1>but it's really just a model and you can't really

0:16:28.000 --> 0:16:30.320
<v Speaker 1>tell what kind of effect it's going to have until

0:16:30.360 --> 0:16:32.800
<v Speaker 1>after it's introduced in the market. In the real world

0:16:32.920 --> 0:16:35.600
<v Speaker 1>is a little different sometimes, right, And there's no as

0:16:35.640 --> 0:16:39.960
<v Speaker 1>far as I know, there's no regulation over introducing a

0:16:40.280 --> 0:16:43.080
<v Speaker 1>financial instrument to the market, you know. I mean, we

0:16:43.080 --> 0:16:46.280
<v Speaker 1>we regulate whether or not you can introduce a non

0:16:46.400 --> 0:16:51.160
<v Speaker 1>native fish into a lake, but nobody's you know, watching

0:16:51.200 --> 0:16:54.120
<v Speaker 1>over the financial instruments that are being introduced to the

0:16:54.200 --> 0:16:59.600
<v Speaker 1>to the the market right right. So I'm thinking basically,

0:17:00.040 --> 0:17:02.760
<v Speaker 1>if we had regulation of that, if things were tested

0:17:02.800 --> 0:17:07.000
<v Speaker 1>out on a small scale first before being released on

0:17:07.240 --> 0:17:10.160
<v Speaker 1>mass that could be helpful. I think there's a whole

0:17:10.160 --> 0:17:12.840
<v Speaker 1>lot of regulation that that could that could you know,

0:17:12.960 --> 0:17:15.200
<v Speaker 1>take place. Well, maybe these guys should start listening to

0:17:15.320 --> 0:17:19.080
<v Speaker 1>Josh Clark. Yeah, I guess this is a pretty dense

0:17:19.119 --> 0:17:22.440
<v Speaker 1>subject to agree, Chuck. It's dense or I'm dense, one

0:17:22.440 --> 0:17:24.400
<v Speaker 1>of the two. I don't think. I don't think you're dense.

0:17:24.600 --> 0:17:27.639
<v Speaker 1>It is. It's a very dense subject that I would recommend, uh,

0:17:27.720 --> 0:17:30.200
<v Speaker 1>anybody listening to this podcast going on to how stuff

0:17:30.200 --> 0:17:32.920
<v Speaker 1>works dot com and typing in how can mortgage back

0:17:33.000 --> 0:17:36.320
<v Speaker 1>securities bring down the US economy? And stick around to

0:17:36.359 --> 0:17:39.360
<v Speaker 1>find out which four articles Chuck and I consider essential

0:17:39.400 --> 0:17:43.440
<v Speaker 1>reading right now? So, Chuck, four articles essential reading, right,

0:17:43.640 --> 0:17:46.120
<v Speaker 1>I'll say them because I know you're shy. Uh. They're

0:17:46.160 --> 0:17:48.639
<v Speaker 1>all articles that you wrote, and they're really great in

0:17:48.680 --> 0:17:52.119
<v Speaker 1>depth articles, and they are about the four uh candidates

0:17:52.160 --> 0:17:56.000
<v Speaker 1>for president and vice president for this upcoming election. So

0:17:56.080 --> 0:17:59.240
<v Speaker 1>we have how John McCain works, how Obama works, how

0:17:59.680 --> 0:18:04.240
<v Speaker 1>Sarah H. Palin Palin Palin works, and how Joe Biden works.

0:18:04.680 --> 0:18:06.639
<v Speaker 1>And I don't haven't read the Joe Biden one yet,

0:18:06.680 --> 0:18:08.800
<v Speaker 1>but I'm hoping there's something in there about his teeth.

0:18:09.520 --> 0:18:12.879
<v Speaker 1>Nothing about his teeth, a lot about his um foot

0:18:12.960 --> 0:18:16.439
<v Speaker 1>in mouth condition. Right, Well, if there's room in that

0:18:16.560 --> 0:18:19.320
<v Speaker 1>mouth for a foot from all those teeth, then past

0:18:19.520 --> 0:18:22.280
<v Speaker 1>does have amazing teeth. They're great beans and choppers like that.

0:18:22.520 --> 0:18:24.840
<v Speaker 1>You can check all four of those out by typing

0:18:24.880 --> 0:18:29.760
<v Speaker 1>in Joe Biden, Sarah Palin, Barack Obama, John McCain, any

0:18:29.800 --> 0:18:32.399
<v Speaker 1>of them in our wonderful search bar on how stuff

0:18:32.440 --> 0:18:37.080
<v Speaker 1>works dot com for more on this and thousands of

0:18:37.080 --> 0:18:40.520
<v Speaker 1>other topics. Is it how stuff works dot com. Let

0:18:40.640 --> 0:18:43.240
<v Speaker 1>us know what you think. Send an email to podcast

0:18:43.520 --> 0:18:47.959
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