Global regulation Environment:

Jun 17th, 2015
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Alcorn State University
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The answer to this we got through the tough financial crisis we faced in 2008 when recession started and banks started falling like a pack of cards one after the other and the whole world saw its affect on the economy gradually.

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Global regulation Environment:What does Global regulation environment has its function in finance industry?? Is it so important we regulate the industry globally or just regulation at national level is sufficient? The answer to this we got through the tough financial crisis we faced in 2008 when recession started and banks started falling like a pack of cards one after the other and the whole world saw its affect on the economy gradually. So as per the current scene we should regulate the finance industry at international level and make sure such crisis doesnt occur in future.What caused the 2008 credit crisis? Loose monetary policy surely played a part. So did compensation plans that encouraged executives to take huge risks in the quest for short-term profits. But one fundamental cause of the credit collapse remains largely unrecognized and largely unaddressed: Congresss decision in 2000 to legalize over-the-counter derivatives trading. O.T.C. trading in credit default swap derivatives, or C.D.S.s, brought our banking system to its knees.The crisis began when the insurance giantAmerican International Groupdisclosed that it had suffered huge losses trading C.D.S.s, derivative bets that companies or municipalities would default on their bond obligations. We could have avoided this if we had stuck with traditional derivatives regulation. In other words, derivatives are bets. Bets can be used to hedge risks. But bets can also be used to speculate, and spec

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