Following the financial crisis of 2008, the United States government decided to take legislative action in order to protect the American public and tighten the leash on the financial sector. From unregulated derivatives markets to excessively risky trading and speculative losses written off under the cover of a portfolio hedge, the tools and investment vehicles utilized by the finance industry generated enormous amounts of revenue, however as the crisis showed, even financial powerhouses are susceptible to failure. Bailing out the finance industry with billions of dollars provided a quick fix for keeping major firms afloat with the taxpayer money, but it was clear that real change was necessary. Continue reading
Following the financial crisis of 2008, the financial industry suffered backlash from the public following a historic and infamous series of events that threatened America’s economy. From media pundits to organized efforts such as the “Occupy: Wall Street” movement, there has been a continual protest against the ‘injustice’ and corruption of greed that supposedly plagues large financial institutions. However, many Americans rely on financial services for retirement savings, investment opportunities, the ability to get a mortgage and more. Despite the complexity of many financial systems, which may be simply understood by the general public, the causes of the crisis held blame with those behind-the-scenes, and an ethical analysis can bring these actors and their decisions to light and provide a clear picture of what was done wrong and why. Looking into AIG, a major player in the financial crisis, a history of ethically questionable management can be seen, with blatantly unethical choices leading underlying collapse of the financial system in 2008.