An Accounting Student’s Thoughts

What do you do in an emergency? As fast as conceivable you survey the circumstance, and search for the quickest approaches to quit looming peril. When inevitable threat has been deflected, you at that point search for approaches to fix fundamental issue. You research the causes and inevitably think of an arrangement to address the circumstance, lighten causes and abstain from having the emergency happen once more. At long last you follow the arrangement to arrive at your ideal objective.

I accept a lot of what the US government did as the sub-prime home loan emergency was unfurling followed the above example. Anyway the legislature has is still during the time spent tumbling down at work of amending the circumstance and maintaining a strategic distance from the chance of future repeat.

As this emergency was unfurling, the Federal Reserve and US treasury got engaged with a bunch of triages to stop the approaching threat of US economy and conceivably world economy breakdown. They gave rescue cash and encouraged required restructurings of numerous money related organizations like JP Morgan Chase, AIG, and Merrill Lynch. I accept the US government worked superbly of “halting the seeping” in our budgetary framework and our economy owing for the most part to the way of thinking of then Federal Reserve Chairman Ben Bernanke.

When fast approaching risk had been deflected, the US government just gently centered around approaches to fix the hidden issues. A couple of good outcomes followed. Congress marked the Dodd Frank Wall Street Reform and Consumer Protection Act in 2010, and there were a couple (accentuation on few) criminal indictments of individuals engaged with the Crisis at lower levels. (See politifact.com article for a particular posting). I don’t have the ability to break down the accuracy or propriety of the US Government’s way to deal with fixing the hidden issues of the Sub-prime Mortgage Crisis. Anyway as this Crisis led to something we call “The Great Recession” which we are as yet climbing out of years after the fact, I do ponder a few things as an Accounting understudy and as a resident.

For example, for what reason was Lehman Brothers permitted to fall flat while other speculation organizations, for example, JPMorgan Chase, Goldman Sachs, and Morgan Stanley were supported/rescued by our Government? Subsequent to perusing numerous articles with investigation and statements from included individuals like Timothy Geithner and Henry Paulson, I feel like there is some missing essential data; the notorious glaring issue at hand that nobody is referencing. I don’t perceive any undeniable reasons why Lehman ought not have been helped by the legislature alongside the remainder of the organizations. I’m trusting extremely hard that this circumstance isn’t similar to the secondary school click circumstance where the “in gathering” simply doesn’t care for someone in particular regardless of how enthusiastically they attempt. Yet, as I referenced, I truly don’t have the aptitude to break down the rightness or fittingness of the US government’s methodology. What’s more, I guess this falls into the “no big deal” classification.

Another for example follows that is rapidly going to become no problem since the legal time limit has arrived. Why have NO significant level administrators been criminally arraigned?? As Neil Irwin writes in his September 2013 blog for the Washington Post, “Zero Wall Street CEOs are in prison… Which isn’t to state no one is in prison. There have been indictments of different home loan intermediaries and other little fish who lied or urged customers to lie on their applications for a home advance… What’s more, truly, significant banks have been working through billions of dollars in common settlements for obscure conduct in the runup to the emergency.”

Consider the possibility that anything has been finished by the administration as our essential law-production substance, our national cop figuratively speaking, to ensure future fraudsters don’t consider this to be acknowledgment of the conduct by quietness. Is this the monetary and money related future we need to anticipate in the United States of America? This is one of the significant things the Occupy Wall Street Movement was irate about in spite of the fact that they didn’t work admirably of imparting it. As expressed in PolitiFact.com (interface), “… the one thing dissidents share for all intents and purpose (is): “We are the 99% that will no longer endure the avarice and debasement of the 1%.”

There is no absence of data, yet there is by all accounts no will (or incidentally no assets) by government legitimate stewards to finish criminal arraignment. There might be nobody clear person(s) or company(ies) holding an indisputable evidence to pursue here, yet one likewise gets the particular impression there is no prosecutorial will or vitality to discover any kind of blame whatsoever. An unusual circumstance, best case scenario as I would like to think. Maybe some accept there is no blame in light of the fact that the laws at the time didn’t properly address the misrepresentation. This doesn’t make the misrepresentation any less grievous.

What’s more, since the legislature has done so little to indict the culprits of the Sub-prime Crisis to date, how might we believe they will finish policing any new guidelines they have created since the emergency??? The Dodd Frank Wall Street Reform and Consumer Protection Act appeared to be an inside and out, confident beginning to making the required laws to dodge and reduce the potential for another emergency like this later on. The Act anyway was marked into law four years back and to date this is what’s occurred:

• As of July 1, 2014, a sum of 280 Dodd-Frank rulemaking necessity cutoff times have passed. Of these 280 passed cutoff times, 127 (45.4%) have been missed and 153 (54.6%) have been met with concluded principles.