Bear Stearns failed, while Goldman Sachs received $22 billion in federal bailouts.įor capitalism to work, failure must be an option. The federal government spent $85 billion saving AIG but allowed Lehman Brothers to fail. ![]() In that respect, “the system” worked.īut then the government went a step further, deciding to save certain businesses – not just the economy. The federal government was able to provide massive short-term economic support in 2008, preventing a complete shutdown of the financial markets. economy.” But for the sake of argument, let’s assume that the entire financial crisis was the result of financial engineering and unfair lending practices. The cause of the crisis was much more complex than “Wall Street greed almost ruined the U.S. ![]() ![]() Natural failure is one of the most beautiful aspects of capitalism.Ĭapitalism produces bad results when government attempts to manipulate the power of competitive forces.
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