(Fact: keep in mind that no major bank executives have yet to face prison over their role in the worse financial crisis since the Great Depression).
The narrative of Wall Street is that no crimes were committed, which brings us to Krugman's argument:
It’s hard for me to believe there were no crimes. Given the scale of this, given how many corners were being cut, some people must have violated laws. I think people should be in jail partly because I’m sure crimes were committed and partly because the lack of accountability is a serious problem. Something terrible happened and nobody has been held accountable.All this may change now that regulators are preparing a lawsuit against some of the country's largest banks in order to probe their role in the acceleration of the financial crisis.The Securities and Exchange Commission is planning to formally warn a number of banks that sold mortgage backed securities in the years leading to the financial melt-down of 2008.
Did banks know (at the time) that the mortgages backing their securities were of poor quality and yet presented a picture of the loans that was misleadingly reassuring?
This possible suit comes at a moment when banks are already being called to account for their handling of another result of the collapsing housing market: the foreclosure crisis. On Thursday, the government announced that it had reached a $25 billion settlement with some of the country's largest financial firms -- among them Citigroup, Ally and BofA, all said to be targets of the SEC investigation -- over charges that the banks engaged in systematic and widespread mortgage fraud.
No wonder JP Morgan Chase's CEO Jamie Dimon cries that all this anti-banking sentiment is a form of discrimination?
So, banking, the industry responsible for the world crisis (the same industry which gets bailed out with taxpayers money) now resents being found accountable?
What are your thoughts?
I'm closing this post next Monday @ 11pm.
Laura Delgado
ReplyDeletePHI2604 MWF 11am
Even though bank executives hold the argument that no laws were broken (which chances are they were) it was wrong to make the decisions that were made. Mostly because they were immoral as they had a fundamental consequence to the human beings living during the economic crisis. Although it may be difficult to find accountability due to the size of these banks, there were certain people that made these decisions. It is those in charge of the decisions that should face the consequences for their actions because it will do some justice for the detrimental results in our economy.
In this matter I would say that I agree with the economist Paul Krugman of course laws were violated and there were crimes. Now the question arise of who is accountable for the economic crisis. As we already know the biggest mortgage lenders and services swamped the economic system with bad practices, and those bad practices and wrong decision were what lead to the worst financial crisis since the Great Depression. I think that banks have huge responsibility in the crisis, because all this financial institutions were lending money and issuing mortgages, knowing that borrowers could not afford it, and they would not be able to pay. Lenders knew exactly what they were doing, they were aware that they could cause massive losses to investors in mortgage securities. This is a perfect example of corporations as moral agents and the diffusion of responsibly. Apparently there is nobody feeling responsible for what causes the economic crisis, but of course everybody was affected.
ReplyDeleteI don’t see justice being served. Call me a pessimist if you will, but it’s been four years and all the banksters have gotten so far is a slap on the wrist. $25 billion dollars is but a drop in the pool of money these people have taken Americans for. We have an estimated $700 billion in negative equity as a result of what these financial institutes have done. And they still have the nerve to call foul over the settlement; it’s enough to make one see red. Fairness has been tucked away in some dark, quiet storage closet. They give us hollow victories for show to make us think we have no reason to be outraged. We sit here and take it while the landed gentry laugh themselves silly. How long will we be pushed before we push back?
ReplyDeleteMeisel Vera
ReplyDeletePHI2604
MWF 11-11:40
In my opinion, I would say that I agree with the economist Paul Krugman it is extremely obvious that many laws were violated ,and many crimes were committed. Now the question is who is really accountable for the current economic crisis. Many of us would agree and point the finger to morgage lenders. These people were lending money to people wanting to buy houses that they couldnt afford. Putting a false income. They made many inmoral and illegal actions, just to get a profit at the time , but sooner than later came back to get them, but yet they havent faced any concequences. It is most likely that they live better than the rest of the population. Many people have lost their homes, cars, and most importantly their jobs. Life keeps getting much more expensive, and more jobs are being cut down. People stop spending causing the economy to stop progressing.
Ingrid Chavez
ReplyDeletemwf 11-11:50
I do find the banks responsible for causing the meltdown for the most part. They had the responsibility to put some restrictions as to who they were giving money to and not lending money to just about anyone that requested it. They knew that some people were getting loans that were too much for the income they received. The banks didn't care that house's prices were inflated. The more people were on debt the better for then, because they would get more money. Yet, it backfired at them because then people weren't able to pay and went bankrupt. It's not fair that we have to bail out these banks with our tax money, when they were taking advantage of the many and got a lot of money from us that they shouldn't have gotten in the first place. Only that one bank that was responsible enough should have stayed on the business. These CEO's from all those banks should be put in trial, and be responsible for their wrong doings. This way maybe next time they will think twice before doing what they did.
The banks should definitely be held responsible for their actions because they certainly played a huge role in the financial crisis of 2008. At the time the banks were probably just thinking about the short term profits and did not take into account the major damage that they would be causing to the American people and to the American economy. The banks may not be owning up to what they did but I believe they knew what they were doing from the start. It was a bad move on the parts of the banks and its time for them to take some responsibility for what they have done. On top of not taking responsibility and no one in jail for misleading people, the banks were given a bailout by the government. The government should have bailed out the millions of people that the banks misled into these loans that now are losing their homes. So now basically the same people that were misled are paying the banks because they cried and the government fell for it. Dare I say that the banks are being rewarded for the immoral things they have done. The banks even with the money they got from the taxpayers some executives gave themselves raises and bought themselves luxurious things while the American people are being forced out of their homes. Some justice is definitely not being served and these banks need to be held responsible. They need to stop playing the victim and take into account the real victims of all of their wrongful actions.
ReplyDeleteWhen I think about what happened with the housing crisis in 2008, it sickens me that something so obvious on who was responsible don't get punished for it at all. When it comes down to business, the main incentive is to make profit. If banks were ignoring on who should they give loans to based on their income, which in this case they were. They should be the one's responsible and either take necessary actions or be punished by the law. The fact that no one is being held responsible even though its so obvious, just baffles me. Our current government on how they handle businesses could be considered to be a joke, and the fact that we the taxpayers have to bail them out is considered to be an even bigger joke. Even though nothing will most likely happen to the banks, I personally really hope that they get punished for their greediness.
ReplyDeleteBrittany Ferguson
ReplyDeleteMarch 5, 2012
MWF 11:00-11:50
Honestly, I think that the banks should be held accountable for the current economic crisis. The bank corporations think that they are too smart and that they can out beat the people. It is unfair that the no major bank executives have yet to face prison period. I think that there were crimes made and the bank executives should be held accountable for them. When you look around our communities today, you will see a number of houses that are in foreclosure. In my opinion this is very sad because there are a lot of people that’s losing their homes because the banks has convince them that they well take care of their mortgages. But all the banks really did was made it worst on the home owners and their mortgage companies. This issue can be solved very easily because it’s not that hard to see who is accountable for the economic crisis. To end with, I absolutely agree with Paul Krugman. These are crimes that the banks have made and they shall be held accountable for them.
Michna Duval
ReplyDeleteMWF 11-11:50
Not only were crimes committed, but laws were violated. The decisions that they made were morally wrong even when they claim that no laws were broken. Many people have lost jobs and homes do to these circumstances and the prices are still rising. I believe the banks CEO's are to blame for these actions because they are after all the decision maker's of the operation. There are indeed responsible and should get served back. In the end, it still has effected our economy and we are the one's to come out the pocket and pay for the wrong doing of others. There main goal was to obtain a profit and now that it is costly it seems that they aren't getting the punishment they deserve. Justice isn't being served and it is unfair to us all.
I most definitely believe that the banks should be held accountable for the financial meltdown of 2008. At the time the banks only had one thing in mind and that was making money, they did not care to predict the tragedy they would cause across the whole country. The damage that they caused back then is still being repaired today and we have to pay for their lack of responsibility. The banks were giving people loans to buy houses not even considering the fact that they might not even be able to pay them back the money. The majority of the people however, were not able to pay the banks back their money and the banks went bankrupt. Even though it was the banks negligence that caused this incident, we still have to pay for their mistake with our tax money. Now the banks are playing the victim role and expect no kind of punishment for their actions. I believe that each CEO should be giving an appropriate punishment for their carelessness.
ReplyDeleteShantell Meneses
ReplyDeleteMwf 11-11:50am
I agree with Krugman. People should be held accountable for one of the biggest crisis we have experienced. Dimon claims that we are being anti banking which I think te ridiculous because it is the banks fault that everything went down the drain. And I do believe banks did know what they were doing at the time. To commit acts that serious, they cannot go unseen. We are talking about millions and millions of dollars that's beig handled by banks. As for the comic picture on top it's true. Protestors (even peaceful ones and ones that had permits to stay in places [occupy] ) are bein arrested but those who actually caused this havoc mess are not being taken care of
I would have to agree with economist, Paul Krugman, on the issue that he brought up regarding laws that were broken and crimes that were committed. There is no way that millions of people were getting approved to buy houses and obtain mortgages that they could never afford. There had to be certain way that lenders were going around making up different kinds of numbers so that they can approve all those people that have now defaulted on their loans. Even though laws were broken and crimes were committed, it is going to be very difficult to prove one person accountable for these mishaps when millions of people represent these banks and work as lenders. I don't believe the government should provide another bailout to help them out because they got themselves into this mess. The banks need to be able to figure out how to rise from this downfall that they created.
ReplyDeleteLORIET MARTINEZ
ReplyDeleteI personally agree with Krugman that many laws were broke and many violations were committed. Nevertheless, I would say that banks were the one most accountable for the economic crisis of 2008. This people were generally thinking about how much money they will gain right away. In other word they were just thinking about fast profit. However, they don’t even look forward and think about possible secondary effects that those forced action will bright into the American economic. When I said forced actions I obviously referred to the broke of rule like for example selling houses to people that they knew that were not making enough income to cover their debt later on. In fact, was prove that great percent of those people that lost their houses during this crisis, reported more income in their loan application than what they really make based on the IRS data. I have the opinion that yes there was crime committed and responsible should be brought to justice.
Nobrega, Barbara
ReplyDeleteMWF 11-11:50
In my opinion the economist Paul was right in feeling the way he did. It is to no surprise that when things get tough and real problems occur there is nobody owning up to what was done to the country. It is a fault in the justice system as well because they are afraid to point fingers to the banks because they are the money of the country. It isn't right though that nobody is held accountable for a crisis that affected the entire nation. A crisis we are still dealing with. When protesters took it to the streets to protest the issue, they were imprisoned, so Paul is right in feeling as though that isn't fair. If you think about it, it was immoral for the banks to give out mortgages that were questionable and not to the owners benefit. Instead it was all for their profit. Some would say this is simply capitalism, a narrow form of it. There are others though who would argue it is simply immoral I believe it wasn't right and shouldn't of been done even though it wouldn't be easy for justice to be served. It would be difficult for you to bring to justice banks and such big important people in our economy. I believe those banks should simply be held accountable at least to some extent for this nation's crisis.
Andres Bonilla
ReplyDeleteIn my opinion it's really hard to give the blame too in this case. Yes banks were giving out loans to everyone who stepped inside the doors. But once the loan is given then the bank has to find someone to insure their money and the one that insures has to find another company to insure them. So if you get what I'm saying it's a very very long chain of companies insuring each other so ultimately who is to blame when there is so many companies who had a part in this not only the banks but everyone including the government itself. It's really hard to bring justice because where do you begin ? I think they should just leave it alone. IT was enough with the bail out why get things messier than it is already. It's like the case with bp. Bp is responsible for the spill but in bp defense they blame the contractor and the contractor blames the sub contractor and the sub contractor blames the sub sub contractor and so on. Justice will never be served because they will never found out where it all started
How can these people be such hypocrites. They lied to people making them believe they can afford to buy their dream home. Lying, deceiving, and cheating others is immoral. As a corporation able to make moral decisions, they need to also accept the consequences of their actions. How can these banks state that they resent being held accountable. Are you kidding me, they knew that these loans were faulty and shouldn't have been approved. But they did them anyways. Thus I agree that they should be held accountable for the crisis of 2008, all the foreclosures on family homes, and for stealing our money, since we bailed them out with tax money. They can state that they resent the fact that we are fighting to help the people and the economy that was hurt in all this, all they want because they are greedy companies, that think of only them. They can state that what we are doing is discriminatory but we don't care. I agree with the people who want to sue. This is a lesson to be learned from these banks. They need to go back and reconsider their morality and loyalty to their customers.
ReplyDeleteGeraldine Flores
ReplyDeletePHI 2604 M,W,F 11-11:50
I believe that the bank should be held responsible for the banking crisis we are in. it was their negligence that caused the problem. The banks only objective was to make more money, not about the well being of the economy or the people. They were giving people money to buy houses and not thinking about the future. They were too busy with the immediate results. People were able to buy houses but couldn’t afford the mortgage so they went bankrupt and therefore the banks as well. But do the banks pay for the mistake? No, the tax paper do, therefore the people do. We suffer for something we had no control over. The CEOs’ were in control and should be punished in a way. If corporations are considered moral agents, then there are consequences to immoral behavior. Lying and deceiving their customers is immoral because the bank should have the best interest for the “customers.”
I agree with Paul Krugman's statement about the banks. Why would people , who are in control of the banks commit such an indecency ? who is accountable for this crisis that has taken place ? Well, this crime that was committed should be pointed towards the banks , but not just the banks but the people, those who are responsible for the decision makings that they initiated. Considering this crisis that has been bestowed upon us, why have the banks or more importantly the people chose this path ? Because of their actions, it led to such a consequences that is a burden on us. So the question is : Are corporates considered moral agents ? yes, If corporations are considered moral agents, they should be punished for their actions.
ReplyDeleteVictoria Rosante
ReplyDeletePHI2604
MWF
Things do not happen on their own, someone must be accountable for these occurrences. It is easy for these big corporations and banks to hide who exactly is at fault, but there is someone. This is a huge economic issue and it must be resolved, why should we let people get away with putting us through all of this when it was they who made it happen? Common people, like, ourselves do not get away with much less. This is an issue that effects everyone and should be put on the spotlight. These bankers had an idea of the consequences of their actions, this makes them moral agents and should be held accountable for their actions.
I agree that banks should be held accountable but the government has to prove that bank executives really set up to defraud investors, home buyers, etc. We can all agree with Krugman that what happened was a travesty for many families and individuals but just thinking its unfair doesn't make those executives guilty of everything. The government decided to bail out the banks. It's well documented that bank executives were told they had to take the bailouts or risk a total collapse of the financial system and in eventually, the banks they managed. If those same bank executives had decided to not accept the bailouts, we would be asking for them to go to jail for allowing their banks and the system to be brought down. The government hasn't brought any charges against bank executives because it failed to oversee the banking industry, partnered with them on the bailouts and receives political donations from the banking industry. Krugman says crimes must have been committed with all that happened but there must be proof that bankers willingly defrauded someone. I don't think it can be proven because all bankers were following the same practices that have now been shown were blamable but haven't been proven fraudulent.
ReplyDeleteTanzania Fields
ReplyDeletemwf
phi 2604
There has been no justice or no individual accountability taken in the actions that have taken place in the financial meltdown of 2008. The claim that there was no crime committed is ridiculous. I agree with Krugman, what happened is terrible and something should be done. No matter how big a corporation is, it should take moral responsibility for their wrong doings. However, the banks involved of course were just looking out for themselves and their ultimate goal was to gain more profit. Consequently they just ended up hurting the economy. The government should step in and hold those accountable for there actions. Instead of taxpayers helping to bail out the culprits responsible. Something needs to be done.
Surely, I believe the banks should be recognized for their actions, but the executives who control what is going on should be accountable as well. This financial mess occured without any vigilance on the corruption going on. Even while the crisis was occurring, executives were going on luxurious trips spending millions of dollars on their vacations. Companies and individuals are still facing financial challenges today from the crisis from almost 4 years ago. I have not heard of a person in charge of these damaging events being put to justice, aside from Bernie Madoff but he's probably unrelated compared to the others. No more time should be wasted since people are still being effected on many areas. Justice needs to be served in order to hold a stable ground on the ever growing problems that have surfaced.
ReplyDeleteAndrea Smith
ReplyDeleteFour years after the 2008 financial meltdown, banks are still to blame for it. I personally agree with the ladder. The bank executives who did commit fraud should be put in jail and become convicted felons for doing so. The whole government and economic system are broken. There should be a sense of security when a law abiding citizen goes to a bank and trusts that their hard earned money isn’t going into the wrong hands or that mortgages are being given to people with bad credit. These certain situations are excellent examples of corporations being moral agents or that workers that are in that corporation are able to handle these moral decisions. There is more that goes on behind the scenes than what people actually know. There is so much corruption that that is the reason why banks were bailed out with our, taxpayers, money. “Fact: keep in mind that no major bank executives have yet to face prison over their role in the worse financial crisis since the Great Depression” I don’t think that bankers at the time of all this misleading foreclosures knew how greatly it was going to affect the country’s economy but they knew exactly what they were doing.
Shannon Watson
ReplyDeleteMWF 11:00-11:50
With all honesty, I dont even know what to think about this. A lot of thoughts are going in my head about this one. Sure, some of the things they did were immoral and they just did it anyway, but maybe we dont know why they did it. I really just dont know what to think about this whole thing. I cant really put my thoughts into words.