In 2008, dramatic events led to the most significant economic crisis in post-war history. One of the largest investment banks, Lehman Brothers, declared bankruptcy, and then several more leading financial organizations disappeared. The documentary “Inside the Meltdown” created by Michael Kirk (2009) reveals the details of the events. Despite attempts to stop the crisis, by the end of 2008, the problem had affected most countries of the world and significantly worsened the well-being of people.
I previously knew that the causes of the crisis were risky mortgages that created a bubble in the real estate market. Many people could get a mortgage, and mortgage obligations were resold in the form of securities as part of investment packages. However, most people who received mortgages could not pay their debt, the value of investments fell rapidly, resulting in a giant bubble burst. The documentary complements knowledge of the crisis by providing detailed information on reactions to events, their key figures, and attempts to save the financial system. The film helps to understand what actions were taken to prevent the situation from deteriorating, which allows assessing its complexity better.
While the documentary does not directly talk about the Dodd-Frank Act and Consumer Financial Protection Bureau (CFPB), it contributes to understanding the prerequisites for adopting this law and creating the bureau. The act and bureau aimed at protecting consumers and better regulating financial institutions to prevent the recurrence of events that led to the crisis (O’Brien, 2018). The documentary describes the prerequisites for these actions, revealing the details of attempts to support the economy and attract government representatives during that events. The State has a moral duty to protect its population, and the law and the bureau are its manifestations.
References
Kirk, M. (2009). Inside the meltdown [Film]. PBS Distribution. Web.
O’Brien, S. (2018). Dodd-Frank changed consumer protections after the financial crisis — here’s how that’s shaking out today. CNBC. Web.