Leave your feedback Share Copy URL https://www.pbs.org/newshour/show/across-the-world-woes-of-collapsed-bank-spread-to-borrowers Email Facebook Twitter LinkedIn Pinterest Tumblr Share on Facebook Share on Twitter Transcript A European bank that lent millions to borrowers around the world, including a Wisconsin school district, needs a massive bailout, which has triggered financial woes among its clients. Charles Duhigg of the New York Times and Adam Davidson of NPR explain the trail of the crisis and the struggles ahead. Read the Full Transcript Notice: Transcripts are machine and human generated and lightly edited for accuracy. They may contain errors. JIM LEHRER: Finally tonight, the ripple effects of the global financial crisis. Jeffrey Brown has that story. JEFFREY BROWN: A local school district in Wisconsin, a German bank operating out of Ireland, collateralized debt obligations, and many millions of dollars that may now be gone, for the last months, we've talked a lot about the global financial crisis and its web of consequences.A pair of reports by the New York Times and National Public Radio present a case study that may well stand for many more around the country.Here to tell us about it are Charles Duhigg of the Times and Adam Davidson of NPR's Planet Money team.So, Charles Duhigg, this all started with a fairly common problem. A local school board, in this case in Whitefish Bay, Wisconsin, wanted to prop up its teacher retirement plan? CHARLES DUHIGG, New York Times: Exactly. The Whitefish Bay, Wisconsin, school board and four other local school boards had what many states and school boards and municipalities have, a problem propping up their retirement funds.The health care costs were growing, and they needed a way to put some money aside to deal with the future, so they turned to their financial adviser and asked him for his advice.And he told them about something called a collateralized debt obligation, or a CDO, which is one of the most complicated financial products that's out there, although they didn't know that at the time. JEFFREY BROWN: And, you know, in reading your account, to the question of why they would turn to these very complicated instruments, it almost sounds like, well, that's what everybody was doing. CHARLES DUHIGG: That's how it was presented. And, you know, until recently, if you'll remember, basically everyone thought that there was an opportunity to get rich in the global economy.We've been hearing about New York — Wall Street bankers getting rich, and governments and cities being able to solve their problems by turning to the stock market, and these more and more exotic financial products. And the school board members thought this is their chance.