Actions taken by the federal reserve
Kat points out a significant pattern: both Iceland and Ireland’s governments guaranteed investors, both foreign and domestic. This made their economies buzz with foreign investment as tidal waves of foreign cash fueled the banking boom. These promises were not met with domestic regulation of these banks to try and shore up the risk to Iceland and Ireland's own central banks. Revenue for banks quickly eclipsed the strength of the lender of last resort in each of these nations. And shockingly, the Irish banks had to treat foreign investors, who invested knowing there was a risk... were treated as equals to the average Irish citizen who used these banks for deposits.
Class discussion led to connections between property (investment) and
- the individual,
- markets (i.e. stocks), and
- governments (i.e.: bonds)