Essay on The Financial Crisis Of 2008

732 Words 3 Pages
A very interesting documentary to view that disclosed what the cause the financial crisis of 2008 was. A documentary about how the American financial industry sets out to deliberately defraud the ordinary American investor. I was amazing to grasp the insight that financial institutions were allowed to trade on their own behalf which allowed them to bet against their own customers with the use of their funds. Unaware of the story in Iceland, a stable democratic economy that was destined for ruin when it’s three banks were privatized and began to borrow recklessly. The irresponsibility of CEO Richard Fuld leads his firm into bankruptcy and then he receives a bonus in the amount of $484 million dollars. This is totally unethical, especially after sending shudders through the markets and sparking a global downturn that would shed 30 million jobs. The financial bubble that leads the collapse in 2008 resulted from a breakdown due to the demise of the traditional practice of borrowers securing a loan for a mortgage and paying it back in due time to a financial institution with interest. The financial crisis has caused a domino effect and caused many people to lose their jobs. Being unable to pay their mortgages put homes in foreclosure and obviously the financial institutions ended up with unpaid bad mortgages. The deregulation of the financial services industry in the 1980s and 1990’s; the growing popularity of complex and risky derivatives; the real estate bubble and the…

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