Financial Collapse

Financial Collapse

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Financial Collapse of Corporate America
(Enron and Adelphia)

In the last decade, America had one of the strongest economies in the

world. Companies made billions of dollars in profit, both for the shareholders, and

themselves. This tenure of economic growth was spurred on by unprecedented capacity,

consumer?s hunger for new technology products, and the shear growth of the American

economy. In fact, according to the U.S Labor Department, in 1998, we were at our lowest

unemployment rate in nearly 20 years, it hovered at nearly 4.6%. Corporate America has

built enormous businesses that have reached global and international markets. However,

many pundits questioned if the economic boom would last into the 21st Century.

However, these pessimists seemed sure that the market would collapse. In 1999, the

world witnessed the unfolding of an economic crash. In order to rationalize this fall, we

need look into the issues that probably that caused this crash: (1) Corporate Ethical Issues

(2) Recent Corporate Scandals, and (3) The Economic Impact. Let us first look at the

ethical practices of with regard to business.

In her book, Managing Business Ethics, Linda K. Trevino discusses the

issue of ethics and states, ? It is the role of every CEO to ensure

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