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Recession around the world
 

Recession around the world

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2009

2009

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    Recession around the world Recession around the world Presentation Transcript

    • PRESENTED BY, PRIYA.S PREETY. RECESSION AROUND THE WORLD
    • WHAT IS RECESSION?
      • Slowing down of every economic activity
      • In a recession many things falls together- production, employment, prices, and business profits
      • Business go bust, and this can lead to runs on banks and a crisis in the financial system
      • when the gross domestic product (GDP) of a country declines for two or more consecutive quarters of a year
      • a general slowdown in economic activity over a sustained period of time, or a business cycle contraction.
    • HOW DID TODAYS RECESSION START?
      • Default in repayment of housing loan started.
      • Financial institutions and investment bankers started feeling liquidity crunch.
      • Along with them all the investors who had invested in those securities started feeling the affect of it.
      • This has affected liquidity and profitability badly at US market as well as in Financial Markets throughout the world.
    • HOW IT STARTED AFFECTING WHOLE WORLD?
      • Globalization
      • Dependency of developing countries on the “Demand” generated from high spending countries like US and Eurozone has increased
      • Huge money (some trillion $)of various FI and IB are invested in these developing economies through direct investment and share market
      • When these FI`s & IB`s started feeling liquidity crunch, they started withdrawing money from developing countries
      • At the same time process of bankruptcy, heavy losses, huge lay off`s of people started in US
      • This has resulted into slow down of overall demand in the market of US and vanishing of money from the world market
      • With a slowdown in US market many in developing economies started feeling pinch of cash in their market
      • This is the beginning of slowdown in other financial markets in the world
      • Along with slowed down US market many FI`s and IB`s started withdrawing money from these developing nations to save there business at home has added fuel to liquidity crunch
      • Thus slowdown process has gripped whole world slowly and steadily
      • The process is still going on
      • No direct impact on nations like China and India is yet seen
      • Indirect impact was so huge that share market in China and India shaded almost 50% of their value
    • CASUALTIES IN OTHER PARTS OF THE WORLD
      • Iceland, once the small nation with highest per capita income is almost insolvent. IMF has agreed an aid of US$ 2 billion and some European countries are also contributing
      • Hungary already received some Billion dollars from IMF
      • Pakistan is asking for money from IMF and getting some from UAE and Saudi Arabia
      • Many Oil producing nations has a setback with price of crude oil is near to $50 per barrel which is almost 35% of what it was before 6 month
      • Growth rate of many developing as well as developed countries are contracting
    • THANK YOU ONE N ALL!