500 words essay answering the questions emphasized below. 2 references.

Economics 2301

Discussion Board- Unit 4

The Financial Crisis: Who is to Blame?

"That's Where the Money Is"

I can't remember how many times I have heard this story used at the beginning of a banking/finance conference that I was attending, but it does provide a good introduction.  In the 1930s, Willie Sutton became a fairly notorious bank robber.  The press added to his reputation with the suggestion that he was the "Robin Hood" of the Great Depression as he (supposedly) would share the "take" with the poor.  Apparently, Willie didn't share much of anything, especially the loot.

After being apprehended and convicted, he spent most of his adult life in jail.  Near the end of his life a journalist decided to write a book about his exploits and spent several months interviewing Sutton.  Those interviews finally came down to one last question…"Willie, why did you rob all of those banks?"

His response was simple and to the point…"that's where the money is."  Willie later denied that statement and said the author made up because it sounded better than his answer which just had to do with the excitement that he felt "sticking up a bank."  However accurate it was, the phrase stuck.

Every time we get into a financial crisis in this country, it almost always involves our commercial banking system in some way.  It is true- that's where the money is.  We have suffered through many difficult financial times.  One of the most difficult was in the late 1980s when our financial system almost collapsed because of speculative banking practices.  It cost the average family in this country $20,000 in taxes to bail out the Savings and Loans and banks.  Then, as now, there were different ideas on the causes but much of it had to do with our deregulation and reduced oversight of our financial service institutions.  Also then, as now, a few people made a great deal of money and then left government (and the public) "holding the bag" as things began to unwind (sorry, I couldn't resist some opinion).  We are still realizing the full magnitude of the current situation but it accurate to call it a crisis.

I think that everyone agrees that we have a significant problem and that our financial system was very near a complete collapse in late 2008.  I am going to ask you to review the information that I am including, as well as any information that you want to add. 

I would ask that you respond specifically to the following questions. Much of this does require your opinion– hopefully, factually supported opinion.  Again, it is helpful to me if you identify the question that you are responding to…As usual, include at least one reference.

1.    In your own words, why did the debt problem occur?

2.   Is it better for our economy to allow free market forces to govern our financial services or should there be more regulation by the Federal government and the Federal Reserve?

3.    Should consumers be more protected by better laws or should the idea of "consumer beware" apply in these markets?  Has unfair, predatory lending been taking place at the expense of the borrower?

4.   Should government help the large banks and brokerage firms and "bail them out" of these bad loans?

5.   How much help should be given to borrowers who are in trouble with their mortgages?

6. Does the Federal Reserve have too much power? Did they overstep their authority in the ways that they have dealt with the problem?

7.   What is your opinion of “moral hazard” concerns? 

8. What “safeguards” have been put in place since the 2008 crisis? Should they be relaxed, today?

Here are several sources—some satirical…some serious. The first, with Bill Moyers was done near the time of the crisis but is still very timely.

http://www.calculatedriskblog.com/2009/04/bill-moyers-journal-william-black.html

http://www.pbs.org/newshour/indepth_coverage/business/moralhazard/ 

A British satire on the financial meltdown with respect to moral hazard 8:50 minutes

http://www.youtube.com/watch?v=WzPij_Ty2aU 

The Crisis of Credit part 1 and 2: 11:05 minutes

http://www.youtube.com/watch?v=Q0zEXdDO5JU , http://www.youtube.com/watch?v=iYhDkZjKBEw&feature=relmfu

A PBS frontline Special “Inside the Meltdown” (2009) how the economy went so bad, so fast and what Paulson and Bernanke didn't see, couldn't stop and haven't been able to fix (56:29 minutes).

http://video.pbs.org/video/1082087546 

Fill in all the assignment paper details that are required in the order form with the standard information being the page count, deadline, academic level and type of paper. It is advisable to have this information at hand so that you can quickly fill in the necessary information needed in the form for the essay writer to be immediately assigned to your writing project. Make payment for the custom essay order to enable us to assign a suitable writer to your order. Payments are made through Paypal on a secured billing page. Finally, sit back and relax.

About Wridemy

We are a professional paper writing website. If you have searched a question and bumped into our website just know you are in the right place to get help in your coursework. We offer HIGH QUALITY & PLAGIARISM FREE Papers.

How It Works

To make an Order you only need to click on “Place Order” and we will direct you to our Order Page. Fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.

Are there Discounts?

All new clients are eligible for 20% off in their first Order. Our payment method is safe and secure.

Hire a tutor today CLICK HERE to make your first order