Who were the winners and losers in the Financial Crisis of 2008: it depends
| Pages | 447-460 |
| DOI | https://doi.org/10.1108/JFC-10-2013-0059 |
| Date | 30 September 2014 |
| Published date | 30 September 2014 |
| Author | James Fisher,Jim Gilsinan,Muhammed Islam,Neil Seitz |
| Subject Matter | Accounting & Finance,Financial risk/company failure,Financial crime |
Who were the winners and
losers in the Financial Crisis of
2008: it depends
James Fisher
Emerson Ethics Center and Department of Marketing,
John Cook School of Business, Saint Louis University,
St. Louis, Missouri, USA
Jim Gilsinan
Saint Louis University, St. Louis, Missouri, USA
Muhammed Islam
Department of Economics, John Cook School of Business,
Saint Louis University, St. Louis, Missouri, USA, and
Neil Seitz
John Cook School of Business, Saint Louis University, St. Louis,
Missouri, USA
Abstract
Purpose – This paper aims to address the question of who gained and who lost in the nancial crisis
of 2008.
Design/methodology/approach – Gains and losses were identied by groups ranging from bankers
to homeowners to taxpayers.
Findings – Gains and losses are not neatly split by a main street/Wall street dichotomy. Major
nancial institutions and their chief executive ofcers made huge gains followed by bigger losses, a
substantial portion of which were shared by taxpayers. Homeowners and taxpayers consistently lost.
Workers and real estate developers experienced a mixture of gains and losses.
Practical implications – Financial legislation is affected by questions of who won and who lost. The
complex mixture of gains and losses must be fully grasped if winners and losers are an important
consideration in the design of legislation.
Originality/value – The detailed analysis and model of winners and losers provide important lessons
for legislators and regulators in all countries.
Keywords Finance, Regulation, Crisis, Bailout
Paper type Conceptual paper
Introduction “When You Come to a Fork in the Road, Take It”
This Yogi Berra aphorism nicely captures the problems with assessing who won and
who lost as a result of the nancial crisis that was precipitated by the decline in the
housing market beginning in 2007. Although the terms “Wall Street” and “Main Street”,
as they have come to be used in the USA, efciently and succinctly describe key players
in the nancial drama of the past ve years, they do so at the cost of precision.
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1359-0790.htm
Financial Crisis
of 2008
447
Journal of Financial Crime
Vol. 21 No. 4, 2014
pp. 447-460
© Emerald Group Publishing Limited
1359-0790
DOI 10.1108/JFC-10-2013-0059
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