Essay Example on Unpacking the 2008 Financial Crisis: An Investigation

The film focuses on various firms, managers, baking regulation bodies, and government agencies who in one way or the other contributed to the 2008 financial crisis. The situation captured in the film is almost similar to the Great depression of 1929. The investigation of the new economic collapse was done in the year 2010. It aimed at identifying the causes, the situation, and the repercussions of the financial crisis.

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Phyl Angellides, chairman, financial market inquiry gives testimony of the situation. He testifies that the financial crisis left over 27 million American jobless. The condition was caused by very low-interest rate charges on banks on the mortgage market. The banking regulations were also reduced to the extent that almost everybody could acquire loans. Banks also engaged in many fraudulent practices. It was notable that in California, anybody could qualify for a loan.

CEO Angelo Mozilo, targeted US multinational market communities as core countrywide customers. His Mortgage Company was making hundreds of dollars a day. His company rose to become the leading mortgage lender in the US financial market. According to William Cohan, Author of the House of Cards, the mortgage market was termed as the most profitable business. Hence, banks could lend mortgage product to almost anybody without considering his/her financial situation. Banks went into a crisis because people could not pay back the loans. Countrywide was the largest mortgage lender.

In London, the financial regulations were also reduced to create a room for fair competition with the USA. Iceland also was focused on developing the financial market. Long-time Prime Minister, David Harrison concentrated on improving the country's economy. Hannes H.Gissurarson, exclusive advisor to the PM Iceland, 2004, argued that there was Privatization of banks and everybody was encouraged to buy a house; leading to the housing boom.

The Housing Boom was also experienced in Dubai in the UAE. Dubai decided to invest massively in mortgage companies, including most extended building in the world. Mohamed Alabbaar, chairman of Emaar Properties, was impressed by the move. This situation also contributed to housing bubbles in Dubai.

Many banks collapsed in the US; for example, Mr. James Cayne's bank was taken over by rival JPMorgan. He argued that it was due to the market condition that had caused the bank to collapse. Lehman Brothers was another bank that faced a tough situation. It struck a deal where it had to be acquired by another firm in Britain, but the government could not agree. Alistair Darling, the Chancellor of the Exchequer in the UK, argues that he could not sign a suspicious deal that would probably misuse the taxpayers' money. He termed the acquisition deal as a liability to the British Government, as people could not understand.

I have learned many points from this movie. One of the facts is that greed can be very costly. The desire to make more money cost many banks in the USA, Iceland, the UK, and Dubai in the UAE to close down. It also led to the unemployment of millions of people, especially in the US. Many investment banks termed the real estate as the most profitable, and therefore issued loans to many mortgage companies and individuals, leading to a financial crisis.

The movie is so educative. It shows how a mess in one part of the world can spread and lead to a severe financial crisis. More so, it can be used as a lesson to various economies of the world. There are many repercussion that can come up when organizations fail to make correct decisions.

I have not liked the way managers seem so desperate. Unfortunately, the managers can fail to predict such a crisis, even though there was an almost similar situation (Great Depression) in the 1930s. The public expects the best from these managers. However, they have disappointed the public severely. Policymakers also had a role to play when it came to bank regulations. I did not like a situation whereby they chose to remain silent until the housing boom emerged.