Rogue Trader

Turns out the reason the world markets fell last Monday was due to the selling of stocks by a Rogue Trader called Jerome Kerviel. This man caused panic in the US Federal Reserve, which caused the abrupt rate cut on Tuesday.

What happened? Well this French Trader somehow managed to invest his company's money into the international stock market. Heavily invested about $7B dollars, leaving them much to open to losses, and something the investment group would never do. The investment group realized this mistake on Friday, realized the true extent/nature on Saturday/Sunday, but they never felt the need to disclose this information to the US government, or other nations.

Instead they tried to hide the fact they were overexposed and determined on monday they would close all positions this man, Jerome Kerviel, had opened. Hence the massive stock dump and sell off on Monday, a national US holiday (Martin Luther King's Birthday). This is what caused a mass exodus and made the US Federal Reserve convene and emergency meeting and declare our economy in a state of emergency.

Worse the bank only disclosed all this fraud on Wednesday after they had finished closing all of this Rogue Trader's positions. This leads one to wonder, why didn't the French bank communicate sooner with other nation's economic leaders? Why were they being deceptive?

Did this really help our economy because of the immediate action taken by the Feds? Or did it cause more turmoil, unrest, and mistrust within our economy?

I find it appalling that a government can get away with covering up such misactions. That they are allowed to rock the global economy and get away with it. Right now we're living and moving to a completely globalized economy. Where no one country is solely independent from other nations.

So what shall we do with the Rogue Trader? And was his company really unaware of his misdeeds, or did they turn a blind eye to him as long as profits were up? Or was he just a scapegoat?