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Lessons from the Global Financial Meltdown of 2008


  • Friedman, Hershey

    () (Brooklyn College of CUNY)

  • Friedman, Linda

    () (Baruch College of CUNY)


The current financial crisis that threatens the entire world has created an ideal opportunity for educators. A number of important lessons can be learned from this financial meltdown. Some are technical and deal with the value of mathematical models and measuring risk. The most important lesson, however, is that unethical behavior has many consequences. This debacle could not have occurred if the parties involved had been socially responsible and not motivated by greed. Conflicts of interest and the way CEOs are compensated are at the heart of this financial catastrophe that has wiped out trillions of dollars in assets and millions of jobs. We present a set of lessons as teaching opportunities for today’s students and tomorrow’s decision makers.

Suggested Citation

  • Friedman, Hershey & Friedman, Linda, 2010. "Lessons from the Global Financial Meltdown of 2008," Journal of Financial Transformation, Capco Institute, vol. 28, pages 45-54.
  • Handle: RePEc:ris:jofitr:1415

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    References listed on IDEAS

    1. Holthausen, Robert W. & Leftwich, Richard W. & Mayers, David, 1987. "The effect of large block transactions on security prices: A cross-sectional analysis," Journal of Financial Economics, Elsevier, vol. 19(2), pages 237-267, December.
    2. Ajay Subramanian & Robert A. Jarrow, 2001. "The Liquidity Discount," Mathematical Finance, Wiley Blackwell, vol. 11(4), pages 447-474.
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    More about this item


    business education; business ethics; self interest; toxic mortgages; credit default swaps; regulation; methods of compensation; mathematical models in finance;

    JEL classification:

    • A22 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - Undergraduate
    • A23 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - Graduate
    • G01 - Financial Economics - - General - - - Financial Crises
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility


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