An Ethical Analysis of Financial Crisis Of 2008



An Ethical Analysis of Financial Crisis Of 2008

Introduction

The market conditions in 2008 can be consider as significantly volatile that affected the revenues of several firms and organizations in the international markets. These conditions started from the beginning of the year 2007 and continued throughout the years 2008 and 2009. In 2008, the conditions of the market were too severe that caused losses in the financial service industry. According to several researchers and analysts, the financial crisis of 2008 can be closely associated to the ethical crisis and moral disasters. The economy of the world and the international market were severely hit by the enormous changes in the practices of several financial institutions and firms that lead to the issue of losses and considerable problems in the international markets specifically the financial industry and service sector. A close review of the literature and the findings of the basis of financial crisis of 2008 reveal that there are several evidences that focus on the decisions of the financial agents and institutions and their unethical practices. The unethical practices lead to the mistakes and problems in the financial industry and the whole market suffered from the losses brought about by some of the agents in the financial and international markets (Argandona, 2012).

This paper discusses the ethical considerations of the financial crisis of 2008 and its affect on the international financial service sectors of the world. It tends to analyze the fact and the reasons of the ethical misconduct in the financial international markets and the causes and consequences of the financial crisis of 2008 brought about by ethical mistakes in the international financial service sector. The ethical failures of lending institutions and the concept of market automation have also been discussed in the paper.

The Financial Crisis Of 2008

In order to describe the ethical misconduct and moral hazards that lead to the financial crisis of 2008, firstly it is required to throw some light on the event of financial crisis that took place in the year 2008. The crisis in the financial industry and institutions started in the mid of 2007 and grown to a broader level in the year 2008. That is why the crisis is well known as the financial crisis of 2008. The financial markets and institutions were severely hit by the initial episodes of the causes that became enormous in the year 2008 and formed the severe financial crisis popularly known as the financial crisis of 2008. As a result of the financial crisis, several firms and institutions in the United States faced issues in the paying back of loans and in this way they became unable to pay the mortgage loans that they have acquired from the institutions. The default in the mortgage loans is associated to the specific segment of the society which is called as the subprime segment.

The issue arose when the ownership of the mortgaged loans was unethically transferred to the other investors in the ...