Crisis panel convenes
(15 January 2010 – Country) A ten member commission, created by the US Congress, convened on Wednesday to examine the causes of the 2008 financial crisis.
As part of the commission top executives from the United States largest banks were subjected to an intensive grilling as they admitted the mistakes made by their financial institutions that led to the collapse of the economy.
The Chairman of the Financial Crisis Inquiry Commission, Phil Angelides, summed up the public’s feelings towards banks before the commencement of the hearing saying that people are angry. They have a right to be, the fact is that Wall Street is enjoying record profits and bonuses in the wake of receiving trillions of dollars in government assistance while so many families are struggling to stay afloat.
The executives that were questioned on the first day of the commission included Goldman Sachs CEO, Lloyd Blankfein, JPMorgan Chase CEO, Jamie Dimon, Bank of America CEO, Brian T. Moynihan and former Morgan Stanley CEO, John Mack, who remains the bank's chairman.
Brian Moynihan, the new chief executive and president of Bank of America, acknowledged that the banking industry ‘caused a lot of damage’ over the course of the crisis which led to the government pumping hundreds of billions of dollars into the firms to keep them afloat.
Mr Moynihan also said that never has it been clearer how mistakes made by financial companies can affect Main Street, and we need to learn the lessons of the past few years.
The financial crisis which has caused more than seven million Americans to lose their jobs as a result of the recession and has resulted in further 25 million being currently unemployed, underemployed because of the lack of full time work, or have given up looking.
The result on the housing market was also profound with more than two million families losing their homes in the past three years and a further ten million have been forced into the foreclosure process during the same period.
Morgan Stanley chairman John Mack admitted that many firms were too highly leveraged, took on too much risk and did not have sufficient resources to manage those risks effectively in a rapidly changing environment.
Jamie Dimon, chairman and chief executive of JPMorgan Chase said that while the bank was able to withstand the crisis and emerge as a stronger institution, it, like many others, made mistakes.
Mr Angelides added that this may be the government’s best chance to take stock of what really happened so that it can be learnt from and faith can be restored in the economic system.
If history is ignored, the government is doomed to bail banks out again, highlighted Mr Angelides.
The Chairman of the Financial Crisis Inquiry Commission, Phil Angelides, summed up the public’s feelings towards banks before the commencement of the hearing saying that people are angry. They have a right to be, the fact is that Wall Street is enjoying record profits and bonuses in the wake of receiving trillions of dollars in government assistance while so many families are struggling to stay afloat.
The executives that were questioned on the first day of the commission included Goldman Sachs CEO, Lloyd Blankfein, JPMorgan Chase CEO, Jamie Dimon, Bank of America CEO, Brian T. Moynihan and former Morgan Stanley CEO, John Mack, who remains the bank's chairman.
Brian Moynihan, the new chief executive and president of Bank of America, acknowledged that the banking industry ‘caused a lot of damage’ over the course of the crisis which led to the government pumping hundreds of billions of dollars into the firms to keep them afloat.
Mr Moynihan also said that never has it been clearer how mistakes made by financial companies can affect Main Street, and we need to learn the lessons of the past few years.
The financial crisis which has caused more than seven million Americans to lose their jobs as a result of the recession and has resulted in further 25 million being currently unemployed, underemployed because of the lack of full time work, or have given up looking.
The result on the housing market was also profound with more than two million families losing their homes in the past three years and a further ten million have been forced into the foreclosure process during the same period.
Morgan Stanley chairman John Mack admitted that many firms were too highly leveraged, took on too much risk and did not have sufficient resources to manage those risks effectively in a rapidly changing environment.
Jamie Dimon, chairman and chief executive of JPMorgan Chase said that while the bank was able to withstand the crisis and emerge as a stronger institution, it, like many others, made mistakes.
Mr Angelides added that this may be the government’s best chance to take stock of what really happened so that it can be learnt from and faith can be restored in the economic system.
If history is ignored, the government is doomed to bail banks out again, highlighted Mr Angelides.
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