14 years have passed since the global financial crisis of 2008 to this month. The bankruptcy of investment bank Lehman Brothers on September 15 caused a global economic crisis.
One of the most significant occasions in American history, the blackout resulted in a lot of pain. By September 2009, it had destroyed over eight million American jobs and over $11 trillion in national value.
The biggest recession since the Great Depression resulted from the crash. He shed light on the risky corporate culture that had long permeated the banking industry, making it impossible to understand something as complex and multifaceted as the 2008 financial crisis.
Additionally, it required the federal government to spend $2.8 trillion and allocate an additional $8.2 trillion of taxpayers’ money to rescue bankrupt companies like General Motors, Chrysler, Citigroup, Bank of America , AIG and a number of other “too big for”. fail” businesses run by corporate panjandrums.
The Tea Party and Occupy Wall Street were two social movements that were sparked by the lack of accountability of banks and other bad actors, and its offspring has been vocal in elections since 2016.
As a result, millions of Americans have lost their homes, their jobs, their savings, and their expectations of a comfortable retirement. There had never been a natural calamity in the country quite like this cataclysm.
There were plenty of would-be cassandras who claimed to have been warning about this for years after the financial crisis. Without mentioning the very specific roots of this very unique disaster, they spoke of “casino capitalism” and “corporate greed”. It was only in the way a horoscope can sometimes come true that they were confirmed.
The Queen of England posed a disarming question to a roomful of professors at the London School of Economics in November 2008, barely two months after the collapse of Lehman Brothers and the collapse of the Western economy: why does the didn’t they see it coming? All were caught off guard.
Many economists and academics have tried to answer his question in the years since, but few have succeeded in identifying the root causes rather than just pointing out the obvious ones, namely such high leverage and risk appetite. . The queen’s question struck a chord with ordinary people who were puzzled as to how politicians, bankers and academics could have missed the coming financial storm.
The Financial Crisis Inquiry Commission, which Congress created in May 2009, is often considered the final authority on the reasons for the 2008 financial crisis. The panel was tasked with restoring confidence in the banking industry by exposing the wrongdoings and wrongdoings that contributed to the Great Recession. However, the 10-member non-partisan group was unable to reach a consensus on what led to the financial crisis. Instead, he completed his forensic work in January 2011 and generated three conflicting results.
The members basically agreed on the facts, but there were differences of opinion on the interpretation. The goldmine of factual evidence surrounding the crisis does not yield a singular narrative or satisfactory theory to explain the reason for the financial disaster, but the variety of conclusions is instructive. Before the disaster can be seen in anything resembling its true context, it could take decades. The storyline is comparable to the plot of the Japanese film “Rashomon”, in which contradictory stories of a crime are provided by numerous witnesses.
Summary of news:
- The bankruptcy of Lehman Brothers caused a financial crisis and government bailouts
- Check out all the news and articles from the latest business news updates.