A Critical Evaluation of the Inside Job Essay Example | Topics and Well Written Essays - 750 words

A Critical Evaluation of the Inside Job - Essay compositors caseThese community have commented on the reasons of the global economic crisis, their role in the crisis and about their reaction when the pecuniary meltdown began. The Inside Job basically means that there are behind the door interactions among the banks, governments and the academia to a certain extent, which triggered the global financial crisis in 2008 (Bradshaw). The infotainment shows how the concepts of keeping a balance in the economy for the safety and financial soundness of the nation were violated by the capitalists who destroyed the economic constancy in the country with the help of various influential people (Bradshaw). These were government officials, who had once been bankers and were now make liberal policies in which bankers could make money, on the expense of take chancesing the financial stability of the region. They used political appointees and people from academia who provided forged evidence o f the advantages of excessive deregulation. Some people in the government, like Barney Frank, tried to limit this touch in order to prevent the economy from breaking down, but their efforts went in vain in face of the high influence of the supporters of deregulation. This process still exists and continues to prevail today, but at a pokey pace (Bradshaw). The documentary has been first of its kind, highlighting the change in the banking system after the deregulation of banks in 1980s. It clearly describes how the risk of the loans previously lived with the lender, which was the bank which made the bank responsible in granting the amount of loans. Gradually, the process of securitization started whereby, the high risk loans were bundled together and were offered to risk taking borrowers on high interest rates. The loans were securitized, and the banks no long held the responsibility to collect the loan back. This subprime market offered high returns for the banks therefore, the b anks lent large sums of money without anticipating that they could default by providing such risky assets. On the other hand, securitization itself is non as harmful as shown in the documentary (Epstein). The securitization process allows the investors to diversify their portfolios by holding a large pool of credit card debt. In this way, investors are not exposed to a single debt risk. It is also a flexible process whereby, the securitizers tailor the pools of debt according to the preferences of the investor (Lee). The risk of default lies on the assets on which the securities are formed (Epstein). If those assets are high risk subprime mortgages, there is a high risk of default, which is exactly what happened with the banks in the United States. After the deregulation, in the stop from 1987 to 2006, the movie shows how banks and its employees enjoyed a favorable time. Bankers became drastically rich and thought of their richness as a response of their smartness. The perception prevailing among the bankers has been clearly portrayed in the movie, as the Bankers thought of themselves as clever providers of successfulness to the nation and that they deserved to be rich (Bradshaw). However, this led to the concentration of huge sums of money amongst a handful of CEOs, economists and members from the government. One of the most excruciating realities of the financial world came to the forefront when Charles Fergusonss documentary highlighted that not only banks and government officials were involved in the excessive deregulation of the banking system, but members from the academia had a springy role in promoting the liberalization process (Bradshaw). The greed of bankers and government o