Economic policies<\/p>\n
The recent financial crisis has presented the gravest threat to the stability of the US economy since the Great depression in the 1930s. As a result, the government implemented various policies to address the crisis. The first policy that was the financial bailout of troubled financial institutions that were crucial to the recovery of the US economy. The government spent up to $700 billion, through the Emergency economic Stabilization Act, in purchasing assets of troubled institutions and capital injection to prevent their bankruptcy and possible collapse (Gerhard & Sherrill, 2016). The bailout was also meant to increase investor confidence and enable the economy to recover. <\/p>\n
The second policy was strengthening control and regulation of financial markets to prevent unethical conduct that may lead to another financial crisis in future (Kuschnik, 2008). Since the financial crunch had party been caused by predatory lending practices and other unethical acts, the government tightened regulatory control through enforcing the Dodd-Frank Wall Street Reform and Consumer protection act (Gerhard & Sherrill, 2016). <\/p>\n
The third policy was developing early detection systems to address risks facing the US economy. Through the Dodd-Frank Wall Street Reform and Consumer protection act, various agencies were created to provide oversight and sustain rigorous standards needed to prevent financial crisis in future (Gerhard & Sherrill, 2016). These agencies were also tasked with increasing the resilience of the US economy against future financial risks.<\/p>\n
Finally, a policy on executive compensation was developed and implemented to safeguard the interests of shareholders in corporations. The Dodd-Frank act empowered shareholders to provide advisory votes on the executive pay packages, and to require executives to pay back any incentives or bonuses received through accounting mistakes (Demyanyk&Hemert, 2011). This policy strives to safeguard shareholders and other stakeholders from exploitation by executives through executive compensation.<\/p>\n
References<\/p>\n
Demyanyk, Y. &Hemert, O. (2011). \u2018Understanding the Subprime Mortgage Crisis\u2019, Review <\/p>\n
of Financial Studies. (2011) 24 (6): 1848-1880.<\/p>\n
Gerhard, H. & Sherrill, S. (2016). Forecasting bank leverage: an alternative to regulatory early warning models. Journal of Regulatory Economics 50:138-69.<\/p>\n
Kuschnik, B. (2008). \u2018The Sarbanes Oxley Act: “Big Brother is watching” you or Adequate <\/p>\n
Measures of Corporate Governance Regulation?\u2019Rutgers Business Law Journal(2008), 64\u201395<\/p>\n","protected":false},"excerpt":{"rendered":"
Economic policies The recent financial crisis has presented the gravest threat to the stability of the US economy since the Great depression in the 1930s. As a result, the government implemented various policies to address the crisis. The first policy that was the financial bailout of troubled financial institutions that were crucial to the recovery […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[10],"class_list":["post-72605","post","type-post","status-publish","format-standard","hentry","category-research-paper-writing","tag-writing"],"_links":{"self":[{"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/posts\/72605","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/comments?post=72605"}],"version-history":[{"count":0,"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/posts\/72605\/revisions"}],"wp:attachment":[{"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/media?parent=72605"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/categories?post=72605"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/papersspot.com\/blog\/wp-json\/wp\/v2\/tags?post=72605"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}