Inside Job

April 30, 2018 Young People

Is hard to watch a documentary like this one and not feel angry and frustrated to know that the reason we are in the deep mess we have could have been prevented if a little supervision would have been implemented and the government auditors would have done their jobs with some ethics. Is also true that money is out there for the smart to get and these CEOs used their power and intelligence to acquire big amounts of wealth that affect our economy greatly.

Objectively in my opinion it is a great eye opener that gives regular viewers a close up of the financial sector and how we got to the mess we have. Inside Job documents the chain of reasons leading to the turmoil of the global financial crisis in 2008. About 2008, a wildfire of bankruptcies, foreclosures, and unemployment spread from the United States everywhere the globe as major corporations in the global financial services industry crashed and burned. Part of it is going to center around sorting out the facts of the matter.

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It’s hard to tell just from watching it how much of the movie was an outstanding explanation of compound issues, and how much was an over-simplification. In my opinion I believe the story the movie narrates is accurate at a mile-high view and much messier near the ground, which in part clarifies how something like this can happen in the first place. In the middle of it, it’s a lot tougher to see. One of those mile-high truths is that the finance sector, by and large, doesn’t have a strong moral scope, extending from the CEOs down to the analysts.

It’s predominantly bad in finance because there’s so much opportunity, but in my personal understanding it is very easy to graduate from a top university without learning a thing about ethics and morals, which leads to a bunch of bright young people entering the real world without any societal inoculation against that kind of corruption. Beginning with the 1970s, Inside Job covers a series of modifications in the financial services industry and its relation to the government, remaining through to the year of 2008.

There are two main themes in the documentary, financial deregulation by the industry and the government and taking suicidal bets for short-term profits. A major sample of the two themes of deregulation and bad bets is the securitization food chain. In a word, the food chain was a system that tolerated organizations in the financial services sector to make wildly risky loans and bets and pass these bets along the chain. By passing the bets along the chain, the agency could earn a commission and relieve themselves of risk.

Since there were two incentives for passing along wild bets, agencies were making as many wild bets as possible and earning wild commissions. Since the loans and bets were dangerous and probable to default, when it came time for the loans to be repaid and the bets to mature the system collapsed because hardly anyone actually had the money to cover these bets.

Further, the leaders of the financial sector were able to take a percentage of the losses and walk away from a mass of bankruptcies, foreclosures, and unemployment with more wealth and more power than they had before. In conclusion, I thought it was very interesting because I don’t really follow stocks. I was just astonished at the sum of money that these CEO’s spend; also at the stellar salaries these people acquire. There is a pattern of corruption that has controlled the money in the US for decades, according to the evidence provided by this documentary.

I didn’t know much about the housing crisis, l learned a lot about what happened. I didn’t know that Goldman Sachs loaned bad loans (sub-prime, another thing I learned about) to millions of homeowners, knowing these loans were bogus. To make it worse they made billions off of whether these homeowners paid them back or not. It is definitely an eye opener that helped me learned about our economy and how we create this crisis. It is also amazing to see that some of the creators of this crisis are still on power.

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