An Exploration Of Cultural Values Responsible For The U.S. Subprime Mortgage Crisis

At the beginning of 2007, the subprime mortgage crisis began in the United States. It then spread to the rest of the world at an amazing speed and took a devastating toll on the global financial markets. Eventually this mortgage crisis gave rise to the worst financial crisis since the Great Depression in 1930s.With regard to the roots of the U.S. subprime mortgage crisis, most scholars, stating from an economic perspective, argued that it was mainly prompted by the government's deregulation of the financial markets and the internal flaws of American economic patterns. A few other scholars pointed out that the American culture was the culprit of the financial tsunami. The author, however, found that apart from economic factors, the factors of American cultural values are also responsible for the onset of the crisis. Therefore, this thesis , stating from a cultural perspective, attempts to elaborate how American cultural values, specifically individualism and materialism, influence the American government, the Wall Street and the mass of consumers ,and suggest that instead of merely identifying the economic factors for the crisis, cultural factors should also be taken into consideration.Firstly, this paper explores the impact of cultural values on economic behavior and briefly introduces the connotations of American cultural values and the background of the U.S. subprime mortgage crisis, indicating that cultural values, like an invisible hand, control the direction and patterns of economic behavior. Then, the paper goes on to analyze the causes of the crisis by focusing on American individualism and materialism respectively. American individualism became more and more extreme in modern America, causing the deregulation of the government over the financial market and the greed of Wall Street bankers. Finally, the paper reached the conclusion that instead of merely identifying economic factors, cultural factors should also be considered when reflecting on the causes of economic disasters. The most important enlightenment the subprime mortgage crisis brought to us is: while promoting the development of the economy and creating huge material wealth, we should also advocate advanced cultural values and a harmonious society.