The accounting practices created a scandal in which the companies were able to hide information from investors. This allowed the stock prices to remain high even when the company was struggling. When the companies collapsed, investors became worried about the overall securities markets. The Sarbanes-Oxley act is a response to the corruption with the attempt to improve business accounting regulations. The act is considered the most extensive increase in regulations since the Security and Exchange Act of 1934.
These scandals cost investors billions of dollars when the share prices of affected companies collapsed, and shook the publics’ faith in the security markets. When examining the SOX act you can see that since 2002 many things have changed in the past eight years. Corporate governance is one of many things that have changed; Public companies must now have a totally separate audit committee composed of entirely independent directors and must contain one financial expert. Security fraud now has much more extreme punishments for those who commit or conspire to commit fraud. Since the introduction of SOX auditors of public companies must keep documentation of an audit for seven years, destruction of any documentation or evidence that someone has committed fraud is now punishable by jail time and fine.
High interest rates. Foreclosure. Bankruptcy. The divide between the very rich and the very poor is getting wider. In 'Maxed Out', documentarian James Scurlock points the finger at predatory lenders for this phenomenon and breaks down exactly how many Americans are sucked into this vicious cycle of escalating, insurmountable debt.
What happened that we needed to have the bailouts? Mortgagers and bankers were making high-risk loans that they could not cover in case of default to increase their own profits, the U.S. government was forced to buy the bank loans since lenders would not lend to each other because financers were taking their money out of the money market as well as credit swapping, trigging a recession crisis. (Stout, 2008) This fueled the OWS anger penalizing taxpayers to pay for the corruption within our financial institutions and sending our economy into a recession, causing citizens to lose their houses, jobs, and insurance. President Obama signed the DODD-FRANK Wall Street Reform and Consumer Protection Act in July of 2010. This act within its 2500 pages requires certain financial derivatives traded in markets under the subject to government regulation and oversight.
The central compliance issue that they are working to curtail is their many violations of the Servicemembers Civil Relief Act (SCRA). Since 2003, the company has undergone scrutiny about overcharging servicemembers and recently returned servicemembers from active duty, which caused many of the servicemembers to face the possibility of a bank foreclosure. When this issue was brought to the company’s attention, J.P Morgan Chase identified two problems. The first was the fact that four thousand-five hundred servicemembers were charged interest and fees that were way above the regulatory cap. Secondly, J.P Morgan Chase
Is it 1930s all over again? Many people draw parallels between today and the 1930s, labeling the present-day state of affairs the Great Recession. They note the high unemployment rate, referring not to the mis-measured, official statistic, but to the number more than double that rate, which also accounts for those who have dropped out from the labor force and are no longer counted as "unemployed". Others worry about the deflationary risk, dollar devaluation, and the status of the US dollar as a reserve currency. Still others worry that the "vital few" - those with high scientific aptitudes and entrepreneurial drive - no longer come to or stay in the United States, but stay in or go back to the many countries whose Iron Curtains have
Article Analysis Over the past several years, unethical business practices, specifically in the accounting and financial categories, have made the news headlines frequently. Corporate America has been hit by greed and an overwhelming desire to make money at any cost, including sacrificing strong ethics and a proper moral code. Unethical situations include treatment of employees and stakeholders, manipulating financial reporting, and selling known unsafe products. Manipulating financial reports most often begins at the top management within a company (Clement, 2006) in an effort to boost salaries for those senior executives. Hiding accurate earnings, reporting inventory sold when it was not, and recording erroneous cash flows are just some of the ways that corporations have used to side step proper ethics.
ECONOMIC POLICIES IN THE BOOK “THE FORGOTTEN MAN” The Economic Policies in the book “The Forgotten Man” Name school Professor course Next to the politically-motivated Civil War, a historical account which has changed the landscape of another significant system in the United States is the Great Depression. In particular, the American economic structure was negatively transformed as manifested by the collapse of the stock market when the country became part of World War II in the early 1900s. Additionally, the nation was faced with a disastrous economic struggle and the unemployment rate escalated. History and the Americans then attributed such harmful situation to the two leaders of the country. Initially, President Herbert Hoover was attacked for being ill-advised and his apparent unsuccessful governance.
As Occupy Wall Street targets the antiquated policies of the richest 1% of the nation, they are exposing the imbalance in the global economy that is controlled by the mentioned demographic. It may have only begun a few years ago in an upsurge of the middle class, but many citizens have been feeling this mistreatment for decades (Occupywallst.org,
Annotated List of Reference The Impact of 9/11 Terrorists Attack on the U.S Economy This source discusses the impact on the United States of America’s economy. It states that fact of the United States stock market and how the DOW movements changed majorly. The impact on the economical growth descended moments after the attacks as the economy endured a direct hit, in the public and private sectors. With this, the consumer’s confidence in regarding their spending was hugely impacted and sent the United States into a recession. This help s with my essay as I can use this information to help me prove my point; that the attacks on 9/11 destroyed the United States majorly.