USA Financial Crisis Inquiry Commission Releases Report on the Causes of the Financial Crisis: This Crisis was Avoidable – a Result of Human Actions, Inactions and Misjudgments; Warning Signs Were Ignored
As the World Economic Forum gathers in Davos, Switzerland (26 – 30 January 2011) under the theme Shared Norms for the New Reality (reflecting a world that is becoming increasingly complex and interconnected but also experiencing an erosion of common values and principles) in the aftermath of the global economic crisis and financial meltdown, the United States Financial Inquiry Commission (FCIC) has released and delivered the results of its investigations into the causes of the financial and economic crisis.
The Commission concluded that the crisis was avoidable and was caused by:
- Widespread failures in financial regulation, including the Federal Reserve’s failure to stem thetide of toxic mortgages;
- Dramatic breakdowns in corporate governance including too many financial firms acting recklessly and taking on too much risk;
- An explosive mix of excessive borrowing and risk by households and Wall Street that put the financial system on a collision course with crisis;
- Key policy makers ill prepared for the crisis, lacking a full understanding of the financial system they oversaw;
- And systemic breaches in accountability and ethics at all levels.
Download the Commission’s full investigation report, summary and conclusions here: