INSIDE JOB ANALYSIS
Submitted by Yashvardhan Singh, 2014PGP432
Inside Job is a commentary on the corruption in the financial system existing in today’s world. Starting from Iceland to USA, the film examines the key financial and political factors behind the financial collapse of 2007-08. The film starts from the political movement behind deregulation of the 1980s, development of trading instruments like derivatives and bundling of loans and mortgages into what was called Collateralized debt obligations (CODs). The film delves into how the subprime borrowers were given house loans at low interest which in the end led to collapsing of the whole system. The film ends by saying that despite recent financial regulations, the underlying system has …show more content…
It is said that he was paid almost $135,000 by the Icelandic Chamber of Commerce to write the report. Similarly many top B school Economics Professors are being paid millions by corporate America both to advise and to sit on their boards.
2. Role of the Government- Corruption and Questionable Appointments
Alan Greenspan, the economist who later became the chief of the Federal Reserve had defended the convicted Charles Keating, accused in loans and saving scam by saying that his investments were not risky. There is something fishy when an economist who can’t point out a risky investment which caused a financial crisis, is made the head of the biggest bank of the country.
Similarly Glenn Hubbard, George Bush's chief economic adviser and dean of Columbia Business School is shown to be a firm supporter of deregulation. When he is accused of being corrupted in the interview he shouts: "You've got five minutes, mister. Give it your best shot." Congress led by Senator Phil Graham removed the derivatives market from regulation. All this shows the political parties are under pressure from the financial institutions to support their …show more content…
When rating agencies are asked, they say it was just their opinion and cannot be taken seriously. People inside or outside the industries were not ready to accept that such a crisis was even occurring. They were in denial either deliberately or did not believe the bubble they had created was about to burst leading to one of the biggest financial crisis the world had ever seen.
Lack of Work Ethics-
The movie quotes- “They’re amazed at how much cocaine these Wall Streeters can use and get up and go to work the next day.” If this is the attitude and disrespect for law while dealing with people’s hard earned money, it is no wonder such a financial crisis occurred.
Silver Lining
Even in all this dirt, there have been silver beacons of hope. There had been some bankers who at the cost of being anonymous had warned of such scams happening. Raghuram Rajan, at a meeting had warned of a “catastrophic meltdown” of the economy. We need more of such righteous people and we ourselves need to bring about the change in society. From a small age we need to understand that ethics is the most important quality once can
Submitted by Yashvardhan Singh, 2014PGP432
Inside Job is a commentary on the corruption in the financial system existing in today’s world. Starting from Iceland to USA, the film examines the key financial and political factors behind the financial collapse of 2007-08. The film starts from the political movement behind deregulation of the 1980s, development of trading instruments like derivatives and bundling of loans and mortgages into what was called Collateralized debt obligations (CODs). The film delves into how the subprime borrowers were given house loans at low interest which in the end led to collapsing of the whole system. The film ends by saying that despite recent financial regulations, the underlying system has …show more content…
It is said that he was paid almost $135,000 by the Icelandic Chamber of Commerce to write the report. Similarly many top B school Economics Professors are being paid millions by corporate America both to advise and to sit on their boards.
2. Role of the Government- Corruption and Questionable Appointments
Alan Greenspan, the economist who later became the chief of the Federal Reserve had defended the convicted Charles Keating, accused in loans and saving scam by saying that his investments were not risky. There is something fishy when an economist who can’t point out a risky investment which caused a financial crisis, is made the head of the biggest bank of the country.
Similarly Glenn Hubbard, George Bush's chief economic adviser and dean of Columbia Business School is shown to be a firm supporter of deregulation. When he is accused of being corrupted in the interview he shouts: "You've got five minutes, mister. Give it your best shot." Congress led by Senator Phil Graham removed the derivatives market from regulation. All this shows the political parties are under pressure from the financial institutions to support their …show more content…
When rating agencies are asked, they say it was just their opinion and cannot be taken seriously. People inside or outside the industries were not ready to accept that such a crisis was even occurring. They were in denial either deliberately or did not believe the bubble they had created was about to burst leading to one of the biggest financial crisis the world had ever seen.
Lack of Work Ethics-
The movie quotes- “They’re amazed at how much cocaine these Wall Streeters can use and get up and go to work the next day.” If this is the attitude and disrespect for law while dealing with people’s hard earned money, it is no wonder such a financial crisis occurred.
Silver Lining
Even in all this dirt, there have been silver beacons of hope. There had been some bankers who at the cost of being anonymous had warned of such scams happening. Raghuram Rajan, at a meeting had warned of a “catastrophic meltdown” of the economy. We need more of such righteous people and we ourselves need to bring about the change in society. From a small age we need to understand that ethics is the most important quality once can