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According to Zero Hedge, (I know, I know) it was hedge funds doing arbitrage between the overnight REPO loan rate, and US treasuries.

What?

The Fed or somebody provides short-term cash over night to various financial critters, to facilitate transactions among them.

Some autofellatory quant (or many) decided to get cutesy with it, and do complicated transactions between that rate, and US Treasury bills -- and make an infinitesimal amount per trade, based on the difference.

What to do? Borrow 50 times your own stake, to pump up the numbers.

So when Russia and Saudi Arabia made crude oil fall 30% in a day, everybody rushed to buy US Treasuries.

Their rate briefly went to 0.31%.

This meant the hedge funds needed cash NOW. ("Margin call.")

So they had to start selling EVERYTHING to raise cash.

Selling, drives prices down.

Prices going down, meant that other people who had borrowed to fund risky guesses, suddenly had to come up with more cash for collateral for their bets.

So THEY started having to sell, too.

Like Dominos.

In the meantime, the bankers, those noble vermin, got a case of the vapors and refused to lend to each other, even overnight.

Right at the same time all the Boeings and Fords of the world said, "You know how we spent hundreds of billions over the last 10 years buying back our own stock, funded with debt, so we could make the C-level executives rich enough to buy 2nd houses for their third mistress?" "Well, we're out of cash, so we're going to to use that $12 billion line of credit from the banks, before they take it away."

EVERYBODY wanted CASH up front, at the same time.

With fractional reserve lending, the bank only has a few percent, of the money lent out, sitting in vaults. They play the percentages that something like this just isn't going to happen.

But it gets worse.

There's 250 trillion of debt in the world by some estimates.

Guess how much leverage there is in derivatives (complicated stock and bond swaps, where each party (heh) "promises" to come up with the money if they guess wrong?).

Try 1.5 quadrillion. One thousand, five hundred TRILLIONS.

And all this, mostly, on the backs of the US taxpayer, who makes and average of $50,000 /yr.

These people should all be injected with Coronavirus, AIDS, Ebola, oven cleaner, fentanyl, krokodil, and then left to rot.

And then *really* punished.

But first, go after the UTTERLY corrupt Congress that wrote the laws to allow this kind of thing: quite a price to pay so they could continue to molest children. (That part is literal. Remember when the Speaker of the House, back in the Clinton years, had to resign for "Structuring" money ? Breaking down transactions to < $10,000 at a time so he didn't have to report it. The payments were hush money to boys he had molested when he was a teenager.)