Psychological Economic Uncertainty due to Distrust in Institutions

One of the major factors that lead to the distrust in financial institutions was the lack of regulations and how they all "suddenly" began to collapse, due to the lack of regulations.



The lack of regulations allowed U.S. banks to use derivatives formulas to over-leverage themselves from a factor of x10 to x32 the required capital.



The distrust and lack of confidence in these financial institutions results in reduced or a lack of needed investments.



The Republicans who advocate deregulation have continued to stand in the way of financial institution regulations, slowing down the U.S. economic recovery in the process.