macro economics discussion question and need an explanation and answer to help me learn.
Congress passed TARP in 2008 to try to save the financial institutions that were adversely affected by the crisis.
However, the process of the government “bailing out” a business is subject to much debate.
Is the moral hazard that was created when the federal government bailed out those firms that made bad investment decisions benefiting those firms and, in effect, penalizing firms who played by the rules?
Do some firms make risky investments knowing that they are “too big to fail” and that, therefore, the government will step in and save them?
FOR YOUR INITIAL POST:
Please post your views on this. Give a reason or example to support your view and why your view makes sense. Cite one source, using MLA format, supporting the example you gave.
Requirements: answer each question in 3 to 4 sentences