Sub-Prime Crisis

1. The question is non whether the U.S. administration treated some pecuniary institutions differently than others, but why? Ideally the Federal hold back, the comptroller of the Currency and the Federal Deposit Insurance Company (FDIC) countenance and protect monetary institutions once they feel as if the disaster of those institutions would possibly have a significant impact on the pecuniary market. Just as banks examine the credit of in the altogether clients trying to borrow money, so the Federal Reserve observes the confirming and the ability to repay loans of the institutions it is considering putting capital in.
The Federal Reserve officers have stated in retrospect that the companies that did receive bailouts, such as AIG, Fannie Mae and, Freddie Mac, clearly had the collateral and showed reliable promise of paid them back in the long term, while Lehman Brothers failed to. Those representing the Lehman Brothers have tell that they besides have the collateral and ought to have been bailed out, but because the government was expecting other financial institutions, particularly Bank of America and Barclays, to barter for parts of Lehman Brothers, they did not participate in the final acquisition. It has also been rumored that Lehman Brothers was intentionally led to bankruptcy as a policy-making action, though this has yet to be proven.




By the time that Lehman Brothers filed for bankruptcy, the financial crisis was well on its way. Some analysts view the Lehman Brothers fall as the governments decision in addressing the ensuing financial crisis, prompting the bailouts of the other companies. However, if Lehman Brothers had been aided, perhaps the financial world would not have come to a screeching pause, stopping alter and borrowing altogether for a short period of time.
For deal who disagree the bailouts altogether, it must be considered that all people believe on banks and financial institutions in one way or another and in the future, helping these banks was more likely than not...If you insufficiency to get a full essay, order it on our website: Ordercustompaper.com



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