The 2008 financial crisis, often referred to as the Great Recession, was primarily triggered by the collapse of Lehman Brothers and the widespread impact of subprime mortgages. Leading up to the crisis, there was a boom in the housing market, fueled by lax lending standards and the proliferation of subprime loans, which were mortgages issued to borrowers with poor credit histories.

Financial institutions packaged these risky loans into complex financial products, such as mortgage-backed securities (MBS) and collateralized debt obligations (CDOs), which were sold to investors worldwide. When housing prices began to fall, many borrowers defaulted on their loans, leading to massive losses for banks and financial institutions.Lehman Brothers, a major investment bank, heavily invested in these mortgage-backed assets, faced a liquidity crisis and ultimately filed for bankruptcy in September 2008. This event triggered a panic in financial markets, causing credit to dry up and leading to a severe global economic downturn.The 2008 financial crisis highlighted the need for stronger regulation and oversight of financial markets. It underscored the dangers of excessive risk-taking and the interconnectedness of global financial systems, prompting significant reforms to prevent similar crises in the future.