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A Brief Note On Legislation And Poor Oversight

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Cause: deregulatory legislation and poor oversight Since 2001, the Federal Reserve System chose easily monetary policy and reduced loan level again. As a result that America began to decrease interest in the two half years. FRS totally reduced interests in 13 times. It allowed financial institution to borrow money for unlimited times. And then, it leaded to increase American money supplement in unusual. The liquidity of market enhance in rush. In this situation, the financial market stimulated consumers’ costs appetite and brought investors’ enthusiasm. At last, it became inflation. It is clear that there are many causes leaded to the financial crisis in the 2008. However, America’s macro-policy is definitely the core reason for the financial crisis. Since 1999, America began to release financial regulation. It made American financial ecological environment break out many problems. For example, financial derivative instruments occurred changes, value chain became longer and longer, which leaded to a subprime crisis. Before subprime crisis happened, the American government proposed a series of acts and policies involved limited export. American government adopted different trade barriers for developing countries. And it also limited technology products which push the domestic products’ price increase and decrease the job opportunities. At the same time, the government controlled domestic economical innovation power. That is also a main reason of financial crisis. Another
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