Current Ethical Issue in Business a few(prenominal) heap have been left unaffected by the advanced(a) financial crisis. Problems in the subprime owe market have caused a ripple affect, which has torn through the economy. As a upshot of the economic downturn, the ethics of top executives at financial firms and redress companies are now in question. Home foreclosures, lack of available credit, and enormous loss to retirement savings accounts are in effect(p) a few of the consequences of this unethical behavior. In addition, the bailout provisions provided by the administration have left American taxpayers facing a raise in taxes. Recently, the ethical conduct of employees at American International Group, Inc. (AIG) has been brought into question. The subprime owe crisis that America is now facing has been grammatic construction for several years. The unethical behavior of financial firms and amends companies has lately been beneficialy realized. The subprime mortgag e crisis was caused primarily by avarice and forgetful judgment of the leaders in the financial industry. Loans were creation issued to people who could not afford to pay them back. The loans that were being issued were because repackaged as collateralized debt obligations, a type of derivative, and resold to investment banks.
Since the rudimentary mortgages that make up these derivatives were provided at a subprime rate, the profit margin was very proud for lenders. Financial firms were unable to resist these profits, even though they knew the encounter they were taking. In order for the financial firms to protect themselves from the underlying risk! s of these subprime mortgage products they hired insurance companies to protect them. AIG was the largest insurer of the collateralized debt obligations, which were created from the subprime mortgages. When the subprime mortgage credit line collapsed AIG was unable to meet their financial obligations. The government was forced to shade in and provide the company with the corking needed to anticipate bankruptcy....If you want to get a full essay, order it on our website: OrderCustomPaper.com
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