Puzzled about the subprime market crisis? Try this explanation by John Bird and John Fortune.

Excerpt:

Fortune: How does that [the subprime market] work?
John Bird: Well, imagine if you can an unemployed black man sitting on a crumbling porch somewhere in Alabama in a string vest and a chap comes along and says “would you like to buy this house before it falls down? and “why don’t you let me lend you the money?”
JF: And is this chap who says this, is he a banker?
JB: Oh no, no, he’s a mortgage salesman. His income depends entirely on the number of mortgages that he can arrange.
JF: So, his judgement to arrange mortgages is completely objective?
JB: Completely objective, yes.
JF: And what happens next?
JB: Well, this debt, this mortgage, is taken — bought — by a bank and packaged together on Wall Street with a lot of other similar debts…
JF: Without going into much detail about what is actually…
JB: Without going in to any detail. No, it’s far too boring. And so this is put into a package of debt and then it’s moved onto Wall Street and … it’s extraordinary what happens then… somehow this package of dodgy debts stops being a package of dodgy debts and starts being what we call a Structured Investment Vehicle…

Bird and Fortune are comic genuises. No other words for it. I’d missed the South Bank Show on which they appeared, so thanks to Hap for reminding me.