[MUSIC] All right, welcome to module eight, the panic phase of the global financial crisis. We begin with a discussion of shadow banking, picking up on a discussion we had earlier in the course, but now going into more detail about the different institutions that will be involved in the various functions of the shadow banking system. We'll then turn to a more detailed discussion of repo, short for sale and repurchase agreements, which we know from our discussion of Bear Stearns, played an important role in Bear Stearns' required rescue. And is going to turnout to play a very important role overall in the freezing up of the financial system in the panic phase. Going to look at specific institutions and markets and what happened to them during this very, very panic phase of the crisis. First the government-sponsored enterprises, Fannie Mae and Freddie Mac, which required a rescue just before Lehman Brothers. Then the key event of the panic phase, which was the bankruptcy of Lehman Brothers on September 15th, 2008. That was quickly followed by the breaking of the buck by the money market mutual fund reserve primary and a run, specifically, by institutional investors in money market mutual funds. We'll turn to American International Group, AIG, and even larger entity than Lehman Brothers, which required an enormous rescue, multiple rounds of an enormous rescue from the federal government. We'll return back to repo. All of these different pieces were related to a run that was going on across a variety of short-term money markets. Most notably at this time, the repo market where we saw effectively something that looked like a run on the bank by institutional investors increasing the amount of collateral they would require for any amount, for any dollar that they were going to provide in lending.