2010 Student Research Conference:
23rd Annual Student Research Conference

The Great Financial Panic of 2008: Lack of Regulation or Congressional Inconsistency?
Ashley D. Reinhardt
Dr. David Gillette, Faculty Mentor

Many critics of the Great Financial Panic of 2008 condemn the lack of regulation on the financial industry as the foremost problem of today, but this paper puts forth an alternative hypothesis that inconsistent actions on the part of Congress could present a potentially greater liability to the health of the economy. The paper explores the nature of the fundamental institutional structure of "Too Big to Fail" and the attending moral-hazard that has played a central role in evolution of this crisis. While focusing on the roles of Congress and the Federal Reserve, this paper questions the causes of the current crisis, the constitutional authority of political, fiscal, and monetary actions, and the potentially impractical dual mandate imposed on monetary authorities. A proper understanding of these issues is essential to understanding the role of the American public state in regulating and stabilizing the new and potentially volatile private market landscape.

Keywords: financial crisis, congress, federal reserve, regulation, dual mandate, moral hazard, too big to fail, market

Topic(s):Interdisciplinary
Economics
Political Science

Presentation Type: Oral Paper

Session: 46-3
Location: MG 2050
Time: 1:45

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