Crises DeMystified

Found a Simplistic Explanation For the Sub-Prime Crisis. Check it out here:
http://flowingdata.com/2008/11/25/visual-guide-to-the-financial-crisis/

Meanwhile,I did a Retrospect on the previous Recessions:

The Dot Com Bubble Burst:

Powered by the internet boom from 1995-2000, several new dot coms came up and expanded at tremendous speeds. The dot coms were governed by the principle of "Get Large or Get Lost". Solely driven by the objective of growing fast, these firms dismissed standard business models and solely focused on increasing market share at the expense of their bottom line. Though on paper, many of these firms were loss making, they invested crazily on expansion through increased advertising. They relied on IPOs and Venture Capital for funding during their initial loss making days. Since it was important for them to grow as fast as possible , they heavily spent in their respective domains and quoted the examples of Amazon and Google, which too were initially loss making.
The growth of dot coms triggered a simultaneous growth of the communication companies which sensed a growth in the broadband connections and invested heavily in fiber optics.

The burst began in March 2000, following a series of events:
1) The massive by-chance sell orders of high tech stocks, such as IBM, Dell, Cisco, which happened on a single day.
2) Declaration of Microsoft as a monopoly.
3) Decelerated spending in computer hardware, post Y2K .
The above incidents triggered a collapse of the stock market and the eventual bubble burst.


The Great Depression:

1) Triggered by the Wall Street Collapse in October 1929. People had taken huge amounts of loans from banks to invest in the stock market which had been going up.
When the NYSE collapsed, people lost huge amounts of money, triggering bankruptcies, job cuts and business closures.
2)Smoot-Hawley Tariff Act was passed in 1930. This act placed tariffs on imports to protect domestic industries. Because of this act, both exports and imports fell decreased by 1/3rd, contributing to the Depression.
3) Federal Reserve Bank policy: The Federal did not release sufficient money into the market when the recession started. Hence people started accumulating the money and consumed less.
4) Before the Depression and after WW1, there had been a heavey invest,ent and expansion of industries. So there was over production and by 1929, supply far exceeded the demand.