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6 - Citigroup and the Financial Crisis of 2008

Published online by Cambridge University Press:  14 July 2022

James J. Park
James J. Park
Affiliation:
University of California, Los Angeles
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Summary

What does solvent mean? JP Morgan CEO Jamie Dimon, 2010 A little more than five years after the passage of the Sarbanes–Oxley Act of 2002 (Sarbanes–Oxley),1 many of the nation’s largest financial institutions failed or were pushed to the brink of failure. An unprecedented decline in housing prices reduced the value of securities backed by housing loans owned by many banks. The resulting insolvency of some of the most significant Wall Street giants prompted the worst financial turmoil since the Great Depression. The crisis raised serious questions about the efficiency of markets as hundreds of billions of dollars in market capitalization suddenly disappeared. The losses suffered by investors were more severe and long lasting than those that came out of the market crisis that helped give rise to Sarbanes–Oxley.

Keywords

CitigroupDodd–FrankFinancial Crisis of 2008loss causationpublic versus private companiesbankingsubprime mortgagesfailure to prosecuteLehman Brothersasset valuation
Type
Chapter
Information
The Valuation Treadmill
How Securities Fraud Threatens the Integrity of Public Companies
 , pp. 95 - 113
Publisher: Cambridge University Press
Print publication year: 2022

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