Banking Industry Meltdown: The Ethical and Financial Risks

The 2008 financial meltdown has been rated as the worst global economic crisis after the Great Depression of 1930. It shook the financial fabric of all the nations regardless of their economic status. It also led to the closure of most of the world's renowned banks and other financial institutions. Analysts have related the problems and the causes of this meltdown to the failure of the banks in their use of derivatives (Will, Handelman, Brotherton, 2013). Derivatives are defined as the financial arrangements that financial institutions formulate in order to hedge out against a future loss. The nature if these financial assets are that they are highly profitable and at the same time perilous (Beder & Marshall, 2011). The allure of profits is what baits the managers to adopt and use them in their institutions. This study focuses on the ethical dimensions...
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