Age of Risk, The (2/3)
This is also part of this series: Love of Money, The (3)
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|Subjects: Anthropology, Business Studies, Economics, Finance, History, International Trade|
The programme explains how people changed their attitude to risk, learnt to live with debt and – above all – how governments stepped back from regulating the system. At the heart of the story is Alan Greenspan, who, for 20 years, was one of the most powerful people in the world. However, in October 2008, weeks after the catastrophic collapse of Lehman Brothers, the man whose ideas influenced the world admitted he just might have been “partially” wrong.
The Age of Risk shows how low interest rates and the economic rise of China left the markets awash with “cheap” money. Banks were also busy inventing new and ever-more risky investment strategies. This, allied with a boom in the US housing market, created the perfect storm that hit in the summer of 2007.
The programme looks at whether the holy grail of economics had really been discovered – a riskfree, guaranteed way of making money – or whether it was a time of mass self-delusion, as bankers, regulators and politicians looked the other way while the economy headed for financial disaster.
Finally, the film tells the story of Roland Arnall, boss of sub-prime bank Ameriquest. He built a multimillion dollar fortune selling sub-prime mortgages and was appointed by President Bush to be Ambassador to the Netherlands. However, in a cautionary tale for the times, he ended his days dealing with lawsuits and paying out $325m in an out-of-court settlement in a case over allegations of predatory lending practices.