When housing prices started falling in 2006, mortgage defaults cascaded through the financial system. The securities built on those mortgages lost value, but nobody knew how much because the instruments were so opaque.

That uncertainty proved fatal. Banks stopped lending to each other because nobody knew who was solvent, and credit markets froze worldwide. When Lehman Brothers went bankrupt in September 2008, a serious crisis turned into full-blown panic — if a 158-year-old firm with $639 billion in assets could fail overnight, nothing felt safe.