Analysis Of The Movie ' The Inside Job ' Essay
The public ratings agencies such as Standard & Poor’s or Moody’s should have been accurately rating companies and investments rather than being concerned about protecting their business. It’s ridiculous that representatives would claim that their ratings are merely “opinions” and that they had no responsibility. (Inside Job) Can you imagine your home inspector saying their inspection was merely opinion and not standing by their work? In 2015 Standard & Poor’s agreed to a settlement of $1.4 Billion dollars for their role in the crisis. (Fortune, 2015)
The derivatives market absolutely should have had more regulation. Complex new investments were being developed that were not regulated and frankly regulators might not have understood. It is particularly worrisome that the derivatives market influences companies to make different business decisions than they otherwise would. This disconnect of the consequences of decision-making could cause fundamental structural changes in the way businesses operate.
In the CDO market, investors should not have been allowed to invest against the CDO failing. You ended up with AGI being on the hook on two sides when a CDO failed, both to the original investor, and then to those who speculated against the CDO failing. (Inside Job)
7. While it can be frustrating…