Inside Job FILM REVIEW

There are 3 Major Problems that I want to emphasize in this Review. The first was the HOUSING BUBBLE. It affects many housing markets in the economy of United States, and at that time the proportional relationship of bank’s own assets ratio of money borrowed by an investment bank versus the bank's own assets reached the unexpected levels. The credit default swap was the same as the insurance policy. By then the speculators could buy CDSs that they will bet against CDOs    that they did not own. Huge number of CDOs was supported by subprime mortgages. One responsible individual that is responsible about this said problem was GOLDMAN-SACHS. in the first half of 2006 they sold more than $3 billion worth of CDOs. This problem was maximized by Goldman because he also bet on low-value CDOs, telling lies about to the investors that it was high quality. And I think that housing bubble has already solved itself, and I think that the question should be the solution to housing implosion. One answer would be to do nothing, let the market find the true price of housing over the next couple of years as foreclosures make their way through the system.

The second problem is the collapse of  the MARKET CDOs leaving investment banks with more than hundreds of billion dollars in loan. Thus The Great Recession began, late the bear stern is out of cash. And on the following months, the federal government took over Fannie Mae, and Freddie Mac, which is nearly collapsing, then 2 days later the Lehman Brothers collapsed. The persons or agencies involved in this said problem was the LENDERS because they are not satisfied in just mortgage, they find a way to find a new higher profit. The “subprime” mortgage i.e mortgages of much higher risk, but paying much higher interest rates, made to borrowers with lower levels of credit. With increasing demand from Wall Street to buy subprime mortgages, lenders became motivated to place ever more subprime loans (since they were no longer at risk, should the loans fail), and began to push messages like, “refinance your home, unlock all that equity, pay off your credit card debt, and go on vacation.” Often, lenders convinced those without credit and who can’t afford a mortgage at all to get one anyway.

And the last problem was UNEMPLOYMENT because of what happened, like the global recession many people not only in the Wall Street but the whole world have lost their jobs, people the banking firms and agencies declare bankruptcy, many people have left with nothing and they cannot get their saving. This problem can be solve by the Government, Government support to struggling industries in order to try to save jobs, The Government needs to try to create demand in the economy. It could; Give grants to businesses to produce goods, Have projects such as road building, Cut interest rates to encourage spending, Cut income tax to courage spending.