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Wide scale government regulation of the financial industry is ended.
Wide scale government regulation of the financial industry is ended. -
The sale and loan crisis caused by 747 of the 3,234 loan association’s failure, costs American tax payers 124 billion.
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derivatives (or ways of betting on the stock market) become wildly popular.
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The Commodity Futures Modernization Act passes, this act stops all work to regulate derivatives.
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The internet stock bubble bursts. This was caused by investment banks took interest in websites that failed costing investors 5 trillion dollars.
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Investment banks begin to bundle debts into collateralized debt obligations (CDOs). They then sold these CDOs to investors with AAA ratings. These loans turned out to be predatory, and many mortgage owners were given loans that they could never pay back.
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By now the financial industry has split into a few giant investment banks. (Lehman brother, Bear Stearns, Merrill Lynch, Morgan Stanley, and Goldman Sachs)
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The housing boom causes the credit default swap (CDS) to emerge. CDSs could be purchased by speculators to bet against CDOs that they did not purchase. However, because the CDOs were backed by phony AAA ratings investment banks like Goldman-Sachs made a k
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unsurprisingly, eventually the market for CDOs crashes. Leaving investment banks with large amounts of unpaid loans and homes they could not sell, Bear Stearns collapses, Lehman Brothers collapses, and Fannie Mae, AIG, and Freddie Mac are taken over by th
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Top players in the failing firms leave their companies with tons of cash. Most executives had a bias board of executives hand them out wildly outrageous bonuses (billions).
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Banks redouble their anti-reform measures. (Even after the collapse). They pay college economics professors and other economic scholars to advocate further deregulation, causing conflicts of interest. (Especially in Harvard)
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Today, after the collapse of the stock market, the prospects look bleak. With their bailouts, banks are as powerful as ever and have significant influence on lobbying efforts in the U.S. Even though everyone is supposed to have a say in America those wit