Governance Softness and Financial Predation

Abstract

This paper posits that key financiers have a hidden financial motivation which is to maximize their own gains regardless of the harm they cause others by catching them by surprise. As such, it appears most appropriate to consider tougher regulatory measures and better controlled governance systems to minimize, if not eradicate, such predatory behaviors. The theory of predation is anchored in the concepts of predatory pricing (first legally discussed in the Sherman Act at the turn of the 20th century) and predatory mortgages (which form the base of the 2008 collapse of major financial institutions in the USA).