On the surface, this financial crisis seems pretty complicated. Wall Street firms made convoluted bets on exotic mortgage securities, and those bets failed for a complex set of reasons. But in fact, investment banks went under for reasons that were quite basic.

Lehman Brothers and Bear Stearns collapsed because they forgot the very principles they urged on their individual clients - such as diversifying and understanding the risks associated with one's investments.

So let's take a look at the key mistakes these financial firms made, to see that you're not falling into the same traps.