US financial crisis was 'avoidable'

Congressional commission releases report saying 2008 meltdown could have been prevented.

    Wall Street executives, US regulatory agencies and the US Federal Reserve are all being blamed in a new report into the causes of the 2008 financial meltdown.

    The country's presidential commission also concluded the financial meltdown could have been avoided altogether. But even as it wraps up its two year inquiry, the 10-member panel remains sharply divided over the causes.

    The report reflects the views of six Democrats, while the four Republicans have written dissenting opinions.

    It also lays much of the blame on what it says are the "reckless" practices of financial firms like Fannie Mae, AIG and Bear Stearns. It says poor controls led to excessive borrowing and risky investments on mortgages.

    It also faults "weak" government regulators like the Securities and Exchange Commission and US Central Bank for failing to rein in the banks they supervised.

    Singled out is Alan Greenspan, the former Federal Reserve chairman, for backing deregulation practices that accelerated the subprime mortgage crisis.

    Lobbyists are also being heavily blamed.

    Al Jazeera's Nick Spicer reports.

    SOURCE: Al Jazeera


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