In the year 2008, there was a serious financial crisis in the US, which led to massive unemployment rates and loss of property worth trillions. The main cause of the crisis was the broken nature of the financial system in the US. The financial regulatory system was antiquated, fragmented and made it possible for large portions of the financial system to continue operating with any oversight in place. Lenders took advantage of the situation through the use of fees that was hidden.
The Dodd-Frank Act
The Dodd-Frank Act was one of the best reforms in the financial sector because it was comprehensive in nature after the Glass-Steagall Act. Dodd-Frank Act was required because Glass-Steagall had been removed in the year 1999 by the then Act referred to as the Gramm-Leach-Bliley Act. The removal of the Act was one general cause for the financial crisis in the US in the Year 2008. After the deregulation of the Act, there was turmoil in the financial sector and the economy as a whole.
Just like the Glass-Steagall Act, the Dodd-Frank Act was instituted to ensure overall regulation of all the financial markets and also ensure minimal occurrences of another economic crisis in the US. The Dodd-Frank Act came into existence after two individual legislators who formed it. The Act was formed by Senator Dodd Chris, who introduced the Act in the year 2010, and brought it forward on May 20 the same year. The revision of the bill…
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