Analyze the backgrounds and impacts of deregulation wave

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Starting in late 1970s and continuing through the 2000s, business environment moved toward relying less on government regulation and more on marketplace to get desired economic objectives. Consensus successes in deregulation have come in airlines, railroads, telephones, and natural gas pipelines. However, reduced regulatory supervision has at times proven problematic. Several large investment banks, commercial banks, and insurance companies (e.g. Bear Stearns, Lehman Brothers, Wachovia, and AIG) failed or were bailed out at taxpayer expense during the financial crisis of 2007-2009 when excessive leverage exposed these firms to massive default risk.

(Questions)

1 Please analyze the backgrounds and impacts of deregulation wave? Please use examples to support your arguments.

2 What are the possible causes for Financial Crisis during 2007-2009? Give examples if necessary.

3 Please comment on the impact of Financial Crisis from the perspective of firms, and investors, and social perspectives. Do you think the government should bail out the large financial companies like AIG? Please be concise about your answers and mark them accordingly.

 

Reference no: EM1375712

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