Show MoreNAME : JAWAD KARIMI
ID NUMBER :05048569
INSIDE JOB: Inside Job is a 2010 documentary film about the late 2000’s financial crisis . The film is in five parts the film explores how changes in the policy environment and banking practices helped create the financial crisis. The movie starts with showing the Iceland bank where it all started from the land scape is shown green and fresh but then as the corporations moves into the country it becomes muddy and dry land with pollution.
In a context of global economic crisis, everyone appears to be blaming the other in order to find who is responsible for such a global decline in growth, important rate of unemployment, rising protectionism... Thus, it seems…show more content…
That is the reason why, after relating some notions of ethics and business law to a few relevant facts from the movie “Inside Job”,
How we got here? Historically, US market was facing some financial issues it showed on the going bankruptcy of Enron and some other companies, Carelessly financial industry sought for new ways to earn income. The companies start taking advantage of publics ignorance of how the market works and what are they really buying. The information was withheld from the consumers and the public and government aid the banks with Deregulating the financial market (Government, Regulators, financial sector) they all helped each other to create this dogma for there own benefits. The ratio of money borrowed by an investment bank versus the bank's own assets reached unprecedented levels. Numerous CDOs were backed by subprime mortgages Goldman-Sachs sold more than $3 billion worth of CDOs in the first half of 2006. The credit default swap (CDS), was akin to an insurance policy. Speculators could buy CDSs to bet against CDOs they did not own. Numerous CDOs were backed by subprime mortgages. Goldman -Sachs also bet against the low-value CDOs, telling investors they were high quality. The three biggest ratings agencies contributed to the problem. AAA-rated instruments rocketed from a mere handful in 2000 to over 4,000 in 2006. The Crisis: The market for CDOs collapsed and investment banks were left with hundreds of billions of dollars in loans,
Inside Job is a documentary that encompasses everything we would need to know about what exactly happened in the Financial Crisis, which we are still facing today. This film which is directed by Charles H. Ferguson describes the corruption and greed by many of the most famous Financial companies we know of. There are five parts to the film which talk about “How we got here”, “The Bubble”, “The Crisis”, “Accountability” and “Where we are now.”
Part I was called “How we got Here”. This essentially talked about what events led up to this massive financial crisis. The American financial sector was regulated from 1940 to about 1980. There were two major crisis right after deregulation started. First was the Savings and Loan crisis which affected taxpayers, because they were the ones paying for the crisis. Then the invention of derivatives became quite popular. Causing Investors to make money, but also making the market very unreliable and unstable. Also, in 2001, there was a crisis better known as the “Internet Stock Bubble.” This occurred due to the fact that Investment banks purposely invested and promoted Internet companies which they knew that would fail. At the end of it all there were giant firms that had formed, instead of having smaller more personalized Investment banks. The main names that were included in this were Goldman Sachs, Morgan Stanley, Lehman Brothers, Merrill Lynch and Bear Stearns. AIG was also a big name in securitized insurance companies and there were three main credit rating agencies, better known as Moody's, Standard & Poor and Fitch. There was even more instability with the creating of CDO's (Collateralized Debt Obligations). Investors were lending out to people who they knew couldn't afford to buy a certain home or pay the mortgage.
I believe that anyone watching just part I of this documentary can make the assumption that we were going downhill with all these unstable inventions that were supposed to bring in more...