In layman's terms, what caused the 2008 financial crisis?

In a single moment the trust that was present between these three parties is shattered. And in the 2008 financial crisis, these contracts involved a huge amount of parties. The value of contracts becomes uncertain In such a stress situation everybody wants to know where they stand. read more

The financial crisis was primarily caused by deregulation in the financial industry. That permitted banks to engage in hedge fund trading with derivatives. Banks then demanded more mortgages to support the profitable sale of these derivatives. read more

The financial crisis of 2007–2008 was a major financial crisis, the worst of its kind since the Great Depression in the 1930s. In September 2008 many large financial firms in the United States collapsed, merged, or went under conservatorship (a person is assigned to manage a company when it cannot manage itself). read more