Large-scale vs. Small-scale Perspectives – 2008 Housing Crisis

The crash of the United States stock market in 2008 led to a severe housing crisis across America. Trying to understand why the stock market crashed is a difficult task. As I read The Big Short by Michael Lewis to familiarize myself with the crashing of the stock market in 2008, I realized that the process of subprime mortgage loans, credit default swaps, and artificial securities was confusing to me. However, I realized that the professional businessmen who created them didn’t know what they consisted of; in fact, nobody knew exactly what the loans consisted of. The complexity of the financial crisis wasn’t just big scale, but also small scale. After reading The Big Short and trying to gain a financial perspective of what happened on the business side of the financial crisis, I then read The Turner House by Angela Flournoy, which gave a smaller scale perspective of how the Turner Family in Detroit was affected by the mishandling of mortgage loans on Wall Street. 

Trying to understand the complexity behind the housing crash is overwhelming but reading different perspectives of the crisis and the impacts, can only expand one’s knowledge on the housing crisis. For the purpose of this essay, I will not be explaining exactly how the falling of the stock market occurred, but rather how the financial crisis impacted a close-knit family, a perspective that is missing in the story of the financial crisis in The Big Short

In The Big Short, Michael Lewis is trying to make sense of how the housing crash occurred. He tries to interpret the perspectives of different professional investors who noticed the high risks in specific mortgage loans given to borrowers and therefore betted against the mortgage loan market. Michael Lewis uses the perspectives of investors such as Steve Eisman who worked for Morgan Stanley, Michael Burry who founded Scion Capital and Charlie Ledley who founded Cornwall Capital. These investors perspectives help the reader understand the housing crisis. Overall, The Big Short is about the 2008 financial crisis that very few of us are able to understand. Lewis offers the reader a financial lens allowing us to understand that loans and bonds became so complex that the investors and businesses handling them didn’t even know what they consisted of. The Big Short consists of many different and connected parts, similar to The Turner House not only because of the relationship to the 2008 financial crisis, but also in the abundance of moving parts behind the story. While The Big Short gives the reader a large-scale perspective of the housing crisis and how it occurred, the novel is missing how the decisions made at the highest level on Wall Street impacted families at a personal level.

The Turner House provides a closer look at the missing small-scale perspective from The Big Short. In the novel, Flournoy draws attention to the impact that the housing crisis had on a family in Detroit due to the mishandling of loans by investors on Wall Street. While there were several moving parts on Wall Street between investors and loans, the Turner Family had several moving parts within their family. With 13 siblings, a deceased father, and an ill mother (Viola), the Turner Family is forced into making the decision of keeping their mother’s house that they all grew up in, or short selling it. Short selling means that the Turner family will sell the house for less than what their parents originally bought it for, leaving them with mortgage debt. Houses were worth less than what homeowners were paying, due to the housing crash. Therefore, families like the Turner’s had to decide if short selling their mother Viola’s home would be best or not. The financial complexities, specifically mortgage loans, led to difficult family affairs. The Turner Family is just one example of what several homeowners experienced during the mortgage crisis.

Delving deeper into the Turner Family, there was more than just financial complexities that burdened families during these difficult times of a financial crisis. As mentioned above, the Turner Family consisted of thirteen siblings, some of whom are married, have children, live in different states or have differing opinions. One example being Lelah, the youngest Turner sibling at 42 years old, who is dealing with her addiction to gambling. Lelah’s addiction to gambling leads to her homelessness. Instead of living on the street, Lelah turns to her mother’s vacant house as a temporary place to live while the siblings decide what to do with the house. However, Lelah is trying to hide her stay at the family house from the rest of her siblings. Clearly, Lelah has several issues of her own between stress, addiction, and homelessness. On top of Lelah’s already complex life, she comes to realize that her family is deciding what to do with their mother’s house that she secretly resides in. Lelah is proof that the housing crisis didn’t impact just homeowners, but a homeowner’s entire family. 

Another example of the several issues that people had to deal with on top of the complexities caused by the financial crisis is seen through Cha Cha, the eldest Turner sibling who is 66 years old. Cha Cha is trying to lead his siblings on a decision about their mother’s house that they can’t afford, a stressor caused by the housing crisis. Additionally, Cha Cha has been experiencing interactions with a haint (or ghost) that visits him while he is sleeping. Because of his interactions with the haint, Cha Cha seeks help from a therapist which leads to stress in his marriage. Not only is Cha Cha trying to hold his family together during the difficult time, but Cha Cha is also trying to hold his sanity and marriage together. Not to mention that Cha Cha has to discover that his sister, a generation apart from him, is homeless and living in their vacant family home. Cha Cha and Lelah are only two examples of family members who have complexities beyond the housing crisis in 2008. Families had struggles and difficulties before having to deal with the Wall Street investors mishandling of mortgage loans. The Turner Family is an example of how the large-scale actions on Wall Street led to negative impacts on families.

The Big Short lacks the small-scale perspective of a family surviving during the housing crisis. The Turner Houseprovides this small-scale perspective. However, if I had only read The Big Short and not The Turner House (or vice versa), I would be losing a wide range of perspectives on a historical event in our country’s history. When reading about any historical event, it is important to read different perspectives of people involved so you are not making assumptions based on a narrow field of knowledge.

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