1. Would you describe the financial meltdown in the 2007-2008 financial markets as a failure of “people” of our “capital market processes? Why? Provide supporting thoughts with ethical theory and examples.
2. Why is diversity and discrimination two important ethical factors that leaders should focus on while attempting to manage their workforce? Provide one example of how mismanaging these issues have had an impact on an organization? How would you explain the importance of this to your employees?
Requirements: One full page per question with 1 reference for each question (APA style).
Requirements: 1 full page per question (2 total pages), with 1 reference for each question (APA Style)
Answer preview
A broader, extensive, and robust regulatory framework is key to protecting the market from preventable adverse consequences (Erfani & Vasigh, 2018). In asserting the role that capital market systems played in causing the 2007-2008 financial crisis, it is essential to examine the financial meltdown from the perspective of regulation. The leading players in the banking sector rolled out what financial experts have since described as predatory lending practices. This scheme focused on low-income earners as their primary demographic, seeking to make high profits from this high-risk endeavor. Therefore, the regulators needed to prevent the reckless investment of funds into bad loans.
While the mortgaging business did well for a couple of years, the supply soon exceeded the demand resulting in a cash liquidity crunch. In the best-case scenario, the regulators could have prevented the crisis by assessing the feasibility of the mortgaging craze and the risks that it brought by undermining liquidity in the market. One may argue that the regulators were complacent in this crisis and their failure to take a keen interest in the bankers’ actions. From an
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