In the 1920s, people became wild over the stock market. They took their money out of the banks to fill the bubble but it was not enough. There was something called lending on margin. If someone could put a %10 down payment, they could have all the money they wanted. This money went into the stock market. Eventually, when industries began to realize that they were not selling everything, stocks began to plummit. The banks lent out the money of other people to go into the market which collapsed.
Today, the situation is no different with the exception that stocks were replaced by houses and that lending on margin was replaced with motgages. However, I think they Keynsian policies adopted during the Great Depression are going to mitigate this crisis but it will still be bad. My biggest worry is that the struggle to end climate change and find alternative energy sources could lead to problems greater than any economic downturn could cause.
There’s alot more but I have to go back to Law School.