Cyprus Financial Crisis

Cyprus Financial Crisis
I. Introduction
With a population of only 1 million and no more than half a percent of Euro zone economy, it is surprising to find out that the financial crisis in a tiny
country called "Cyprus" has enormous global implications (Long 2013). It cannot be also denied that the "Subprime Mortgage Crisis" of the US in
2008 has its downbeat domino effect to the world including European Union and Cyprus. In this report, not only the most critical reasons but also the
aftermath of Cyprus financial crisis and possible alternatives which could have been done to ease such economic downturn will be carefully examined.
II. Body
1. Main Reasons
The root of the crisis lies when Cyprus experienced a terrible recession in 2009 when the ... Show more content on Helpwriting.net ...
That decision let Cypriots themselves furious and they have responded by trying to clear out their accounts and that will negatively impact on the
deposit security or stability. Apart from any possible instability in deposit base, Eurozone banks may see their ability to rise unsecured funding
deteriorate.
Cyprus became the first ever Eurozone country to apply capital controls with limits on credit card transactions, daily cash withdrawals, foreign money
transfers and cashing cheques. This is a clear indication of the severity of the situation and, effectively, at least temporarily devalues Euros located in
Cyprus as they are now less easy to transfer.
More than a thousand bank employees marched in the capital Nicosia on Saturday, angry that their jobs could be lost in the forced restructure of the
island 's economy –– and that the government had proposed to nationalise pensions in order to fund the bailout. That option was later rejected.
Some protests to express Cypriots' indignation happened on the street, while parliament voted overwhelmingly to reject the tax on bank accounts.
Furthermore, Banks have been closed for more than a week, to prevent depositors moving their money off the island, which would have caused the
banks to collapse and made the entire situation worse. However, ATMs were still opened, and they were quickly ran out of money as everyone tried to
withdraw as much

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Summary: The 2008 Financial Crisis
hroughout History, our great Nation, the United States of America, went through many era's of financial crises that resulted in depressions. This also
happened in 2008, when we experienced an immense financial crisis known as the Great Depression of 2008–2009. In an effort to end the financial
crises, the government established three major bailouts: the Emergency Economic Stabilization Act of 2008 (EESA), the Troubled Asset Relief
Program (TARP), and the American Recovery and Reinvestment Act (ARRA). Overall, the financial crises of the Great Recession of 2008
–2009
caused the government to implement various bail–outs in an attempt to stabilize the economy. These programs have their own advantages and
disadvantages that affect individuals and... Show more content on Helpwriting.net ...
The Treasury is now gradually drawing to an end of its remaining TARP investments and continues to implement TARP initiatives to help struggling
homeowners avoid foreclosure (Tarp Programs). The American Recovery and Reinvestment Act (AARA), which is also known as the Recovery Act or
the Stimulus, is a legislation that was enacted by the United States Congress and signed into law by Pres. Barrack Obama on February 17, 2009. It was
designed to stimulate the U.S. economy by saving jobs that were put at risk by the Great Recession of 2008–2009 and to create new jobs (American
Recovery and Reinvestment Act). In addition, it created measures to update our nation's infrastructure, enhance energy independence, expand
educational opportunities, improve affordable health care, provide tax relief, and protect those in greatest need. The Department of the Treasury
initiated nine programs, including tax changes and the delivery of an estimated $150 billion, which were designed to directly relief Americans and
their families (Recovery Act). Indeed, these programs were relevant in my

Financial Crisis
1 Introduction
The latest global financial crisis was exploded in 2008. This was the most serious financial crisis since the economic depression which occurred in
1930s and it severely impacted the global financial market. Lots of corporations collapsed during the 2008 financial recession which was caused by
breakage of capital chain. Although some companies did not bankrupt during that period, they also had suffered huge loss.
The 2008 global financial crisis began from America. American financial crisis came from the prosperity of real estate. Before the 2008 global
financial crisis, a large number of financial derivatives were generated and financial bubble became more and more serious. Finally, American
sub–prime crisis occurred ... Show more content on Helpwriting.net ...
Nevertheless, Ghoshal disagrees this view and approves of the stewardship theory, because it can effectively give consideration to the profit of
'customers, employees, shareholders ' and their 'communities ' (Davis, Schoorman and Donaldson, 1997, citied in Ghoshal, 2005: 81).
2.3 Background of financial crisis
The 2008 global financial recession has been described a 'once in a century credit tsunami ' (Earle, 2009: 785). This is a disastrous blow to global
financial community. Bullard (et al, 2009, citied in Hu et at, 2012) points out that many economists regarded the global financial crisis as the most
serious global finance disaster since 1930s. Compared with only 11 banks was bankruptcy during 2003 to 2007, at least 160 American banks went
broke in 2008 and 2009 (Fdic, 2011, citied in Hu et al, 2012). From this statistics, it is not difficult to know how strong influence brought by this
financial crisis.
There is a close link between the 2008 global financial crisis and sub–prime crisis. Bernake (2007, citied in Hlenzerjr and Zhao, 2012) asserts that
'sub–prime mortgages are loans made to borrowers who are perceived to have a high credit risk, often because they lack a strong credit history or have
other characteristics that are associated with high probabilities of default '. Furthermore, during 1990 to 2000, because of the IT

Global Financial Crisis And Its Effect On Australian...
The Report gives the insight of Global Financial crisis and its effect on Australian Retails Markets and
Supermarkets. Particular the Impact of GFC on the one of the second largest leading independent
supermarket, FOODWORKS during the period of 2007–2009 and examines the impact of the Global
Financial crisis on the performance of the company. The global financial crisis brought with it very
many challenges. Some were controllable while others were uncontrollable. Foodworks being the
second largest Independent supermarket in Australia faced many difficulties during this period.
Financial aid from the government made recover all the industries, in the span of three years these
companies survived and came into profits, and government took appropriate steps to stimulate and
come over the crisis.
BACKGROUND
FoodWorks is one of the most leading retailer market, groups of Australian United Retailers Limited
which was started in November 2004 and later formed as a Food Works Supermarket group Ltd and
the member Australian National Group which is the main competitors for Woolworth, Iga, Coles, and
Aldi. FoodWorks is the second largest leading Independent supermarket in Australia. The Annual

Turnover is excess of $2 billion in retail level. Its Operation more than 650 stores and having franchise
nearly 400.The main Headquarters is in the state of Victoria. The only one supermarket in Australia
which is different from every store to store and have strong

Effects of the Asian Financial Crisis on 1997
The financial crisis in many countries in Asia in 1997–1998 was an unexpected event. It was mainly because most of the Asian countries had been
enjoying economic growth prior to the crisis. The crisis itself started with the devaluation of Thailand's Baht in July 1997. The Thailand government
decided to float its currency in order to defend the Baht against speculative attack, despite its fixed exchange rate system. This decision was apparently
the beginning of the economic downturn of many Asian countries, such as Malaysia, Philippines, Hong Kong, South Korea, and Indonesia. Before the
crisis, Indonesia's economy was growing rapidly; having a low inflation and a well–maintained current account deficit. However, Indonesia
surprisingly became the country that was affected the most by the crisis. This paper aims to examine the effects of the Asianfinancial crisis in
1997–1998 to Indonesian economy and how it could happen.
After Thailand floated the baht in 1997, Indonesia's monetary widened its currency–trading band. It changed the exchange rate regime from floating
exchange rate to free–floating exchange rate, causing the Rupiah and the stock market to decline. Before the crisis, the exchange rate between the
rupiah and the US dollar was approximately 2,600 Rupiah/USD. The rupiah started to depreciate to 4,000 Rupiah/USD, and dropped dramatically to
over 11,000 Rupiah/USD on January 1998. The spot rates were over 14,000 in January 1998 and trading again over 14,000 during

The Cause of the Asian Financial Crisis
This is a review of the political reasons that caused the Asian Financial Crisis in 1997. The review is made on 5 papers by 5 authors on the subject.
Introduction
The Asian Crisis of 1997 and 1998 affected many of the East Asian and South East Asian countries surprised many. This was due to the fact that in the
early and mid–1990s these same countries were lauded as model economies with high Gross Domestic Product (GDP). Yet within a space of a few
months in mid–1997, the currency crisis become a financial/economic crisis as many of these countries currencies were greatly devalued resulting in
the contraction of their economies. However, the severity of the Asian Crisis was not uniformly felt.
Many books, research papers and ... Show more content on Helpwriting.net ...
Due to this, "their states were 'strong' for their struggle to industrialize but 'weak' because of the web of enmeshment; they are semi–sovereign states"
(Cummings, 1999).
The end of the cold war meant that America no longer had to rely so much on Japan and Korea to safe guard against the advancement of communist in
South East Asia. Therefore from early 1990s, America has pushed for these countries to adopt multilateral economies (i.e. be more open to accept
American goods and investment). However, Japan and Korea were resistant to this new form of economic policy.
Though no actual action by American was provided in the paper that resulted in the Asian Crisis, the author does state that the crisis allowed America,
through the International Monetary Fund (IMF) to implement their economic model to Korea. This was done to maintain American's hegemony in
Asia, which before the crisis may have shifted to Japan. That is one of the reasons provided by the author on why America was firm in its refusal to
allow the 'Asian Fund' proposed by Japan to materialise.
C.Jeffrey A Winters. 1999. The Determinant ofFinancial Crisis in Asia. In The Politics of the Asian Economic Crisis. Cornel University Press.
Winter's paper seeks to explain the source of the crisis and the reason why certain countries were more affected by the crisis than others. The author
"posit that the source of

Financial Crisis And Its Effects On Financial Institutions
The recent financial crisis has a huge impact on systemic Important Financial Institutions; it's distressing effect can be felt in almost every business
area and process of a bank. A fairly large literature investigates the impact of financial crisis on large, complex and interconnected banks. The great
recession did affect banks in different ways, depending on the funding capability of each bank. Kapan and Minoiu (2013) find that banks that were ex
ante more dependent on market funding and had lower structural liquidity reduced supply of credit more than other banks during crisis. The ability of
banks to generate interest income during the financial crisis was hampered because there was a vast reduction in bank lending to individuals and ...
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Recent studies have investigated the impact of the 2007–2009 financial crises on banks' capital. Berger and Bouwman (2011) emphasised the
importance of capital during financial crisis. Their empirical study concludes that banks with solid capital base have some benefits during the crisis
than those that are poorly capitalised. Well capitalised banks are more able to withstand the shocks due to liquidity squeeze, and therefore had higher
chances of surviving the crisis period. Other benefits accrued to well capitalised banks include increase in their market share and profitability, as
customers withdrew their funds from less capitalised to a well–capitalised banks. This conclusion was also reinforced by a recent empirical study
conducted Olivier de Bandt et al (2014) on a sample of large French banks over a period of 1993 – 2012. Similarly, Gambacorta and Marques–Ibanez
(2011) demonstrate the existence of structural changes during the period of financial crisis. They conclude that banks with weaker core capital
positions, greater dependence on market funding and on non–interest sources of income restricted the loan supply more strongly during the crisis
period. Using a multi–country panel of banks, DemirgГјГ§–Kunt, Detragiache and Merrouche (2010) find among others results, that during

The Financial Crisis Of The Foreclosure Crisis
Introduction
During the real estate boom of the early 2000's Wall Street began offering a product called mortgage backed securities that were essentially multiple
home loans bundled together. They then started selling off pieces of those loans to investors who wanted exposure to the booming real estate market
in the form of a tradeable security. As the popularity of mortgage backed securities increased the banks needed more product which were more
mortgages. The pool of borrowers with a good credit history diminished the lenders lowered their qualification standards to satisfy the growing
mortage demand. To entice more borrowers and speculators lenders began to offer loans to people with bad credit and even no down payment. The
term liar ... Show more content on Helpwriting.net ...
The crises showed just how interconnected the banking system is throughout the world. The Lehman Brothers bank closure in 2008 created a major
financial crisis around the world due to its influence (The Economist, 2013). It took the government's massive bail outs to prevent total collapse of the
financial system and to some extent economic collapse of the country. This government action set a precedent and to some sent a message that the
reckless action by the banks in the name of profit is fine because they now have a safety net. It is a good example of how the collapse of a big
financial institution that has national and global influence can affect several interrelated firms to the detriment of the country's economic interests.
This paper therefore, examines the notion "too big to fail" in relation to banking.
The Concept Too Big to Fail Kaufman (2014) explains that the concept "too big to fail" is one that is complex to warrant regulation to prevent it from
failing. Due to its influence, the government must intervene to prevent it from becoming insolvent. The special regulation to prevent failure includes a
requirement for higher capital, putting in place measures such as increased liquidity. Besides, frequent supervision by regulatory bodies like the Basel
Committee, the Federal Reserve, or the Federal Deposit Insurance Corporation (FDIC) are necessary to prevent the collapse of "too big to

1997 Asian Financial Crisis
1997
Asian Financial Crisis
Angelica M. Montefalcon
4FM2
I. Introduction
For about twenty years, East–Asian countries were held up as economic idols. They were hailed as the ideal models for strong economic growth of
developing countries because of their high savings and investment rates, autocratic political systems, export–oriented business, restricted domestic
markets, government capital allocation, and controlled financial systems.
They were even stories about "The East Asian Miracle" because of the extraordinary growth rates they achieved and the speed with which they have
transformed themselves from poor countries into industrial powerhouses. Western leaders were impressed by their ability to continue to achieve... Show
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Thais' real estate business boomed, owning property and selling or leasing it for development became one of the most popular businesses in their
country. Rich Thai players entered into collusion with local and foreign banks, mostly Japanese banks, to loan more money just to keep on building.
Because of overbuilding, they were no longer able to rent out most of their new office and condo space. Prices dropped due to oversupply, so they
couldn't get nearly as much money on what they used to built those. When the bank loans became due, they couldn't pay. This also became a
contributing factor in the problem faced by Thailand during the Asian currency crisis. They wern't able to weigh whether investments in buildings are
worthwhile, they were reckless and the only thing they though was the funds they were able to get for building those infrastructures. Their foreign
borrowing went to prestigious projects with no solid economic returns.
Another reason behind the 1997 Asian financial crisis was the large current account deficits. Asian leaders agreed that large current account deficits
could not be good, but they made the logical economic argument that if a current account deficit mostly reflects higher investment, it would eventually
increase an economy's competitiveness and therefore its ability to repay the debt, and would certainly be more sustainable than a deficit driven by

Global Financial Crisis By The Wall Street Crisis
The purpose of this report is to study Global Financial Crisis 2008.This study is inspired by the Wall street crisis and it covers why's and after effects
of the crisis. After this crisis many of the roots causes were observed like speculation, fragility of the system, greed of the managers which adversely
affected the market. The global financial crisis of 2008 is a major ongoing financial crisis, the worst of its kind since the Great Depression (The Great
Depression originated in the United States occurred on October 29, 1929, known as Black Tuesday.). It became prominently visible in September,
2008 with the failure of several large United States–based financial firms. The underlying causes leading to the crisis had been reported in ... Show more
content on Helpwriting.net ...
As demand for the CDOs started growing across the global investment community, the investment bankers (like Lehman) who were meant to sell these
instruments also started investing a significant portion of their own capital in these.
As Wall Street firms like Lehman were churning more and more home loans into CDOs and selling them or investing their own money, there was a
pressure on the banks to issue more loans so that they can be sold to the Wall Street firms in return for a commission. Slowly banks started lowering
the credit quality for availing a home loan and aggressively used agents to source new loans. This slippery slope went to such an extent that in 2005,
almost anyone in the U.S could buy a home worth $100,000 (45 lakhs INR) or more without income proof, without other assets, without credit history,
sometimes even without a proper job.
The U.S. housing market went into a classic speculative bubble. Home loans were easy to get, so more and more people were buying houses. The
increased demand for houses caused the price to increase. The rising prices created even more demand, as people started to look at homes as
investments – investments that never went down in value.
In late 2006, Mortgage lenders noticed that people would choose a house, sign all the mortgage papers, and then default on their very first payment.
Although no one could really hear it, that was probably the moment when one

Financial Crisis 2008
Banking Academy| City University of Seattle|
CORPORATE FINANCE
THE GLOBAL FINANCIAL CRISIS 2008 Group's member:Nguyб»…n NhЖ° Nam (C)Phan Thu AnNguyб»…n ThГ№y DungHoГng BГЎ
SЖЎnNgГґ Thб»‹ ГЃnh TuyбєїtDate: 28/11/2014|
AbstractIn 2008 the world was fell into the worst financial crisis since the Great Depression of 1929–1933. Although this crisis has gone, however, its
consequences for the economy of many countries is very serious, even now many nations are still struggling to escape difficulty. Just in a short period,
the crisis originating from America has spread to all continents. It led to a series of serious consequences such as the falling in stock markets, increasing
in unemployment rates, large financial institutions had been ... Show more content on Helpwriting.net ...
Prior to formally entering the financial crisis, a range of signs forecasting this event had happened around the world. Problems with short–term debt
funding and mortgaged assets were not limited to the United States, which is also the underlying cause of the financial crisis (Stoeckel, 2009). In
2001, the U.S economy fell into recession after the dotcom crisis and the terrorist event on September 11. To encourage the consumption, the central
bank had lowered interest rates. The result was that with interest rates so low, investment and consumption became too easy, the U.S financial
markets rapidly back and created "real estate bubble". Started from the housing market, the crisis quickly spread to the entire U.S financial system
bank. In 2007, the 4th biggest bank in the U.S, name Lehman Brothers was under pressure. Lehman tried many different ways to save itself such as
raise capital, sign a deal with Morgan Stanley and Bank of America, merger with Barclays but none of it worked ("Financial Crisis 2007/2008
Overview," 2011). From here, everything was ready for the crisis explosion in September 2008.
2. Reasons
There are so many reasons lead to global financial crisis in 2008. In this case, I want to mention to seven main causes which directly promoted
financial collapse. 2.1 The housing bubble
From 1890 to 1997, the real price of housing in the U.S. remained relatively stable. When prices peaked in 2006, the average price

Kindleberger's Crisis : Financial Crisis
Kindleberger's Crisis
Financial crises seem foreign to our thinking, something faraway, irrelevant in the context of modern society. But in truth, it is a very real phenomenon
that had impeded the progress of nations and, many times, driven their victims toward bankruptcy and financial dependence. For this, its significance
calls for analysis, as a means to understanding and, more powerfully, prevention and alleviation. Hence, the subject of this paper is to (1) describe a
model, particularly, Minsky's model of financial crisis as delineated in the second chapter of Kindleberger's Panic, Manias, and Crashes, (2) qualify it
from the lenses of Reinhart–Rogoff's criteria for financial crisis, as well as find causes as to why, in the bubble, economic actors should think that a
bubble phenomenon should not lead to crisis, like past other bubble phenomenon in history had, and (3) apply the model to the most recent crisis of
2007–2008 and evaluate it from that viewpoint. First, we begin with the model.
Minsky's model seed of a hypothetical crisis is a growth–inducing shock, called displacement, to a sector of the economy, perhaps the invention of the
internet, a financial derivative, or some technological advancements that lead people and firms to expect economic growth in that particular sector,
anticipate profit opportunities, adjust their financial prospects, and finally, demand more credit in hopes that the return on their capital exceeds cost.
Lending institutions, whose

Financial Crises And The Economic Crisis
Introduction
Financial crises are fundamentally, periods of economic turmoil. This essay is an analysis of the underlying economic scenario in three specific
financial crises that have occurred, since the Wall Street crash of 1929. It goes on to explain its impact on global trade and the lessons that G20
governments can learn from them.
Synopsis of the problem
The focus of this essay is the Global financial recession of 2008 (also termed as the Great Crash), Mexican crises of 1994 ( famously called the
Tequila crises) and the Asian crises of 1997. It's an attempt to understand and analyse the different impacts that the financial crises have had on
international trade.
The Great Crash of 2008 was caused by a bubble burst of sub–prime mortgages in America, which resulted in a crash of the US housing market. This
domestic economic crisis quickly transformed into a global recession and spread economic devastation worldwide. During this period world trade and
foreign manufacturing bore the steepest fall since the Great Depression.
During the Mexican crises (1994) despite increases in interest rates and fall in foreign investments the government tried to support the peso with
dollar reserves. However, due to excessive depletion of the dollar reserve, the peso was devalued which caused a major bank run resulting in a financial
crises.
The Asian crises of 1997 were triggered by Thailand as they gave up the fixed exchange rate regime, leading to a major currency crisis. The

Global Financial Crisis
ACCG 399: Accounting in Context
Accounting's Positivistic Tendencies: Overlaying a Social Science with Pure Scientific RationaleвЂЁTutorial 5 – Week 6
Thought Activity
The film 'Inside Job' is explained the occurrence of the global financial crisis in 2008. It has shown that lots of companies have bankrupted and
millions of people lose their jobs and homes around the world. Such as United States, Iceland, England, France, Singapore and China. There is a
sentence in this film has make me impressed, which is " the poorest always pay the most."
The director has separated this film into five parts, which are How we get there, The Bubbles, The Crisis, Accountability and Where we are now. The
entire film has shown a harsh reality, which is ... Show more content on Helpwriting.net ...
In this film governments allow Banks to have home ownership program, its lend money to poor people to buy houses. It starts out great and home
ownership explodes. But when the crisis comes and the bubbles burst, the poor people would not repay their mortgage, they cannot afford, and then
they become homeless. The rich people got the profit. It can be seen that during the financial crisis, the poor people lose more, and the rich people get
more. Therefore, everytime the government intervenes in the free market, even on the grounds of virtue, bad things will happen. We need to be wary
when politicians try to do things on our behalf.
The initial causes of collapse of financial system in Iceland was deregulated banks within Iceland were able to amass a debts load almost ten times
their GDP, and eventually unable to carry this debts, it will lead to crisis.
Actually, the positive accounting theory tries to make good predictions of real world events and translate them to accounting transactions. To Achieved
Positive Accounting Theory, we can Change accounting policiesвЂЁ, Managing discretionary accruals, Timing of adoption of new accounting
standards, advertising, repairs & maintenance and capitalize operating expenses.
During the financial crisis, the market cannot correct itself, we need government regulations and I think only US government can control Wall Street
and the

Personal Narrative: The 2008 Financial Crisis
At the time of the financial crisis in 2008 I was about 10 years old. So, I was old enough to know what was going on, but not why it was happening.
My dad is self–employed, so we really experienced the repercussions of this event. My dad is in construction and is a snowplower, so the number of
clients he had needed projects to be completed or driveways to be plowed severely decreased. Also at the time my mom was a stay at home mom for
both of my sisters, but after the crisis occurred this would no longer be able to continue. My dad had also just bought a brand–new plow truck so now
in addition to having less clients they now had a car loan they had to worry about. Another aspect that I remember hearing about is how high the
price of houses was as well. They were being priced way higher than they we worth. So, at the time my uncle and his family purchased a house out in
Genoa for about $300,000 and within a few years they had lost so much money from the sale because the market crashed and their house was worth so
much less. But the thing is the lenders were doing this to most people. They would offer them a loan for more than what they can afford. ... Show more
Sadly, I know this wasn't the case for much of the country. Not only did families have issues not being effected but also the companies. While I
watched the video "Inside the Meltdown" most of the information I had heard before in my other classes that I have taken at ECC. But I thought it
was most beneficial to see each company that was responsible. But really, I think people are still trying to figure out who's responsible for the
meltdown. But in my eyes, it's time to move past that and focus on what is happening

Financial Crisis And Its Effects On Economic Growth
The late half of 1997 and the early parts of 1998 presented the world with one of the world's most famous financial crises. This financial crisis proved
to be detrimental mainly to the south–eastern Asian area, including South Korea, Thailand, Malaysia, Singapore, Hong Kong and Indonesia. The
aforementioned south–eastern states recorded astounding economic growth in the preceding decade. The downfall of the economy caused a domino
effect in the local markets and currency markets of each country. The nations' leaders, as a result, had to request assistance from the IMF. Politics were
important in creating the financial boom, but they were also guilty of the subsequent consequences. Similar to a number of financial crises in the past,
the Asian financial crisis came to be as a result of unexpected economic growth. The countries were all under the influence of a number of different
economic criteria, such as cheap yet fairly well educated labour, lowered barriers to trade, and economies based heavily on exports. Even Malaysia
enjoyed bountiful foreign direct investment. All of these elements came together to make Asia dominant force in exports. This was proven by the fact
that none of the countries affected by the crisis experienced of export growth lower than 12% between 1990 and 1996. Not only did these countries
experience rapid growth in exports, the nature of the exports where product types are concerned also changed. The products evolved from simple
products like

The Crisis And Financial Crisis
Since 1970s, with the continuously deepened process of financial liberalisation and financial deregulation, the increasing improvement of financial
innovation and the intensified fierce competition, diversified operational strategy has shown an increasingly apparent trend among financial
institutions. A wave of business diversification swept global financial firms from the later 1980s until the recent financial crisis happened. From the
microeconomics perspective, comparing with specialised business structure, a diversified operation may provide financial holding groups more
benefits that generated from information advantage, the economy of scale and effect of coordination. Also, diversification is considered to disperse
risks that exposed to financial holding groups. Many people believe that the development of global financial institutions shows a continuous trend in
business diversification and cross–industry business operation and such trend will keep going on in the future. However, the subprime crisis and
subsequent downturn again drew people's attention to the pros and cons of universal banking. Around 2008, the global financial system was suffered a
destructive crisis which especially destroyed the western financial world heavily. To prevent such crisis in the future, discussions and debates were
being heated. Solutions and measures were proposed by many countries' regulators. Factors that several reasons underlie the financial crisis have been
widely blamed, for

Impact of Financial Crisis on Gulf Area Essay
Background The global financial crisis that was experienced in 2007/2008 affected many nations of the world. Some countries such as America and
most European countries were hard hit since they were directly affected by the crisis. Other countries especially those in Asia and Africa were not
adversely affected as they were not directly hit by the crisis. This crisis started in the United States after the housing bubble busted. Although the
bursting of the housing bubble was the main cause of the crisis, there were a series of events that preceded it. One event that indirectly contributed to
this crisis was the Russian debt crisis as well as the Asian financial crisis that took place in 1997/1998. These two events made many investors to ...
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This foreclosure negatively affected both the financial institutions as well as individual borrowers. For the borrowers, their wealth was drained and
their purchasing power eroded (Martin, 2009). For the financial institutions, their strength as banking institutions was greatly affected. Their
liquidity had greatly reduced and most of the banks were struggling to carry out their daily monetary activities. The total losses that were recorded
during this crisis were estimated to be trillions of dollars globally. The Federal Reserve as well contributed to this crisis through some of the
policies that it instituted. Between the year 2003 and 2004, this institution lowered the rate of the federal funds from the initial 6.5 per cent to just
1.0 per cent (Jane, 2011). This move was aimed at addressing the effects that were associated with the terrorist attacks that took place in September
of 2001. These measures were also meant to soften the negative effects that were occasioned by the collapsed dot com bubble. At this time also, there
was a perceived risk that the United States could suffer from deflation. These measures were therefore aimed to combat this risk of deflation. These
measures increased credit uptake but the expected results were not realized. To address the said problems, it was expected that the money borrowed
would be invested in business.

Analysis Of The Current Financial Crisis
Analysis Of The Current Financial Crisis
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Financial crisis is a situation where the financial value of assets or an economy drops by a significant margin that can cripple the normal functioning of
an economy of the affected country. Different economists came forward to explain theories that lead to the differentfinancial crisis especially in the
history. These economists include Krugman, Taylor and Blinder. Causes of the crisis include recessions, banking shocks, currency crisis, stock shock,
and financial bubbles amongst others. There is evidence of financial crisis I the past. Most of the time, the crisis was brought ... Show more content on
Helpwriting.net ...
The model has three parts; the aggregate demand equation. The equation relates the domestic spending to real income alongside the interest rate, with
the net export. y = D(y, i) + NX (eP*/P, y). The second part is the money–demand equation: M/P = L(y, i) and the third part of the model is the interest
arbitrage equation. This part explains that investors should shield themselves against risks and expect the exchange rates to be stable; i = i*
The model has its limitations as no exchange rate is expected not to change with time (Bernanke and Gertler, 1989). The third part is therefore
unrealistic.
The figure shows output y and exchange rate e. The line AA shows points at which the domestic rates equals the foreign rates. The line GG outlines
the amount of output given a particular exchange rate. When a strong open economy effect is added to the model, a crisis occurs. For example, if
foreign currency controls most debts of many firms in a country, the balance sheets will constrain their investment. This will lead to domestic demand
having a direct dependence on the real exchange rate; y = D(y, i, eP*/P) + NX(eP*/P, y) . Under these circumstances, when the real exchange rates
becomes unfavorable, the firms holding foreign current will not be able to invest. This will lead to triviality at the margin of the direct exchange rate
effect. The corporate sector runs bankrupt but the small businesses benefit from weak currency. The effects can be so significant

The Financial Crisis Of The Fiscal Crisis
The 2007–2008 financial crisis is seen as one of the biggest failure of risk management. This is the reason why it has been described it as a credit
tsunami.
The aim here is to look at the state in which the financial market is at the moment after being hit by the 2007–2008 financial Crisis. The first part of
this report introduces some key issues that have affected the confidence in the banking sector and its importance in the banking sector. The second part
will provide explanations on how to restore confidence.
Confidence is very vital in the banking sector.
The 07–08 financial crisis known as credit crunch as led the confidence in the banking sector to a dramatic fall. Evidences have been proved for
example with customers redrawing their deposit form banks like northern rock.
As mentioned by Gerard Caprio (2005), a crisis always lives citizens cautious with their savings in the banking sector. Mistrust or lack of trust has led
to the failure of banks like Northern Rock and Lehman Brothers.
Why has confidence been dented?
Finding the way to promote confidence is very important because it will be the key to prevent or avoid another financial crisis. A recent study has
shown that bankers were making decision without knowing the securities of treasuries they were buying. Instead of basing everything on credit
worthiness, banks were more focus on interpersonal and individual relations (Ingves, 2014).
The first problem was with the customer behaviour. Banks are

The Global Financial Crisis
In the following essay, I will briefly summarize some of the main events leading up to the global financial crisis. Following this, I will discuss the
effect this had on the banks and ergo the credit supply, then examine how this contributed to the corporate failure. I will also pay some attention to
how the market imperfection can affect firms real decisions. Finally, I will sum up the main points of the essay. The banking panic of the fall of 2008
set economies around the world into a severe recession. The spark of the panic was seen in mid–2007 the credit boom, followed by the demise of
subprime mortgages and securitized products. This, in turn, raises worries about the solvency and liquidity of financial institutions, evolving into a
full–blown banking panic. Resulting in the failure of the Lehman Brothers and Washington Mutual, and multiple governments run financial institutions.
(Ivashina & Scharfstein, 2009). As a result during 2008 the prices of most asset classes and commodities declined, although the cost of corporate and
bank borrowing rose significantly. In both the USA and the UK interest rates peaked at over 5% (See Appendix A). Consequently, Syndicated lending
started to fall mid–2007, then accelerated during the banking panic September 2008. The lending in the fourth quarter of 2008 2008: Q4 was 47%
lower than the previous and 79% lower than in 2007: Q2 (ibib).
A decline in the demand could explain the overall drop in lending, it might also explain

Shareholder Value and Current Financial Crisis: An...
Shareholder Value and Current Financial Crisis: An analysis of the Relationship INTRODUCTION Corporate governance in a particular firm is
inevitable for its administration, policy making and overall health. In other words, 'Corporate governance affects the development and functioning of
capital markets and exerts a strong influence on resource allocation[1].' Not only does it conduct the present running of a firm but it also has a futuristic
outlook and a good corporate governance system encourages innovations in the firm[2]. There may be counter arguments that the existing cut–throat
competition in the market can be left for taking care of good governance in a corporate because one lacking good governance will definitely be... Show
more content on Helpwriting.net ...
In other words, maximizing shareholder value is enriching the shareholders through either issuing dividends by the company or increasing the stock
price of shares of the company in the market. 1.2 Shareholder model of Corporate Governance. As already discussed, each Company has to be run on
a certain model of Corporate Governance. Amongst the many forms and models of Corporate Governance, shareholder model is a prevalent one. Now
what is this shareholder model of Corporate Governance? The so–called 'shareholder value' norm is not simply or even principally a legal rule or
principle. It is above all a practice which came to shape managerial behaviour in large, listed American and British firms, and increasingly those in other
jurisdictions, in the last decades of the twentieth century[10]. In the words of Hansmann and Kraakman, who offer the most lucid and fundamental
explanation of shareholder model, 'The principal elements of this consensus (shareholder value model) are that ultimate control over the corporation
should be in the hands of the shareholder class; that the managers of the corporation should be charged with the obligation to manage the corporation in
the interests of its shareholders; that other corporate constituencies,

2008 Financial Crisis Report
The economic turmoil of 2008 is arguably the worst financial crisis since the great depression of the 1930s. Although financial crisis is not entirely
new, each one is characterized by unique challenges that make it difficult to make a prediction on when and how the next financial crisis might occur.
The financial crisis of 2008 to 2009 was marked by a failure in the efficiency of the financial markets, inability of regulatory bodies to regulate the
financial product and was catalyzed by weak macroeconomic fundamentals prevailing at the time. In the aftermath of the turmoil financial crisis, there
has been a debate in the financial community on whether there are specific indicators that precipitate a financial crisis and whether the global
economy is at a risk of experiencing the a repeat of a financial crisis of a similar nature to the crisis of 2008. The ... Show more content on
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In the aftermath, it became essential for regulators to review policy approaches to prevent recurrent the earlier crises going into the future. The lesson
that informed regulators in reviewing the policies is that markets cannot be self–correcting, and regulators must intervene from time to time to prevent
financial bubbles from forming or to prevent the effects of the financial crises when they occur (Tropeano, 2011).
Between 2008 and 2009 global finance institutions such as the World Bank and the International Monetary Fund started to advocate for monetary
measures that were anti–cyclical. The objective was to avoid a depression through combing fiscal and monetary policies as economic stimulus
programs but aimed at ensuring social inclusive (Petkovski & Hristova, 2011). It is, therefore, arguable that the adoption of the measures proposed by
the World Bank and IMF prevented the occurrence of depression which would have had catastrophic effects on the global

The Financial Crisis And 2008 Is A Big International Crisis
In every country, they always have a chance to have a financial crisis, it depends on the government and banks, which means Australia might go to
have a financial crisis in the further year. Banks can reduce the likelihood of having a financial crisis in countries. Many possible ways to have a
financial crisis and 2008 is a big international crisis. Australia financial system helped the government to reduce the damage from the 2008 international
crisis, many countries except Australia have a serious problem and impact after the crisis. Australiafinancial crisis can cause by banking and houses, it
can avoid one crisis, but may not evade the second, so they should find a solution to avoid the crisis come.
The financial crisis, the value of ... Show more content on Helpwriting.net ...
Therefore, every bank trying to avoid this situation (Ellis, 2015). A speculative bubble is also called stock exchange, people generate income from
buying stocks. Many people who guess the price of a stock and hoping to have a higher price after. When all people keep buying the same stock, the
price is getting higher and higher, if they all want to sell at the same time, the price will fall. Therefore, the price of a stock is more than the current
price including dividends and interest, that means the stock are having exhibited a bubble. Finally the international crisis, a speculative attack or cannot
pay the country debts, they will force to devalue its currency and either, these countries will affect other countries with their trading, therefore, create
financial crises in their country and might affect the whole world. (Sociable, 2014) In 2007 to 2008, there a huge international crisis and its affect so
many countries at one time.
In 2008, there is an international crisis started in USA. It affects almost the whole world. The American enterprise institute, Peter Wallison had found
in a research that said in United States government, they still believe in the idea of the 2008 financial crisis was caused by insufficient regulation of
the private sector (Opinion Journal: What Caused the Financial Crisis?, 2015). There are some countries in Europe have not been in crisis because
they were not have held by the United

2008 Financial Crisis Analysis
The financial crisis of 2008/2009 was the most serious economic decline since 1929. This paper will discuss a few of the causes of the crisis, the role
the Federal Reserve played in connection with the three main economic goals, and will then describe traditional and non–traditional measures taken to
stimulate the economy. Finally, this essay will relate the government to our present day economic environment and explain why some economists say
that the United States is experiencing a "new normal."
The economic and financial crisis of 2008/2009 can be attributed to many things. The main reason for the crisis can be attributed to the housing
industry and the mortgages associated. When individuals borrow hundreds of thousands of dollars from the ... Show more content on Helpwriting.net ...
This caused lenders to reduce their standards, giving loans to those who had poor credit and low income. Predatory lending practices were also used,
giving out loans without verifying income. Additionally, adjustable rate mortgages were offered, which offered payment homeowners could manage to
pay for at first, but expanded beyond what they could continue to pay for. Since these practices were new, historical data showed that mortgage debt
was a safe investment. Investors continued to dump money into these investments while realistically, these investments were becoming more risky.
(Wallison)
Due to all the investments being made, careless lending requirements, and low interest rates within the real estate market, housing prices continued to
increase. Finally, borrowers started defaulting on these loans, putting more houses on the market. However, there were not many buyers. Housing
prices began to fall since supply was up and demand was down. Often, mortgages became worth more than their house was worth. By 2007, large
lenders were declaring bankruptcy. They had invested large amounts of money into the Mortgage Backed Securities and were losing money on these
investments.

Financial Crisis Essay
In 2016 it was estimated that the US wealth gap had reached a width previously seen in the 1920s. Since the 1970s America's middle class has
been shrinking, whilst the lower and upper classes have been growing, the former at a much faster rate to than the latter. It's negative effects are
best stated up John Taylor in the Hover Digest: "On the Fraser index, the United States ranked 2 in the year 2000 and it ranks 14 today. On the
Heritage index it ranked 5 in 2008 and it ranks 12 today. On the World Bank's Doing Business indicator it ranked 3 in 2008 and it ranks 7 today."
(Hover Digest 9). Much of this shrinkage has been attributed to various periods of economic turmoil in the past several decades; the 1979 energy
crisis, the Savings and... Show more content on Helpwriting.net ...
Post–Great Depression deregulation began in 1980 when then President Jimmy Carter signed the Depository Institutions Deregulation and Monetary
Control Act into law. This was the first piece of bank–reform legislation since the Great Depression. Among other things, the bill included provisions
lowering the Federal Reserve's mandatory reserve requirements for banks, preempted state usury laws that limited interest rates lenders could charge
for residential mortgages and allowed depository institutions to access the Federal Reserve Discount Window for credit advances. In other words,
banks could borrow more of the taxpayers money, gamble with said money and states' attempts to protect their citizens by regulating interest rates
Banks charged for mortgages on homes. This charity to large Banks was the first to come in a long line of endowments to corporate America caused by
the mushrooming of free market fundamentalism during the Reagan Administration that has persisted to modern day. It is no coincidence that
immediately following the birth semi–capitalist largess was full of economic issues; deregulation led to irresponsible practices by During the 90s
deregulation continued to sowing the seeds of future downturn for the US economy as both major parties shifted economically right. The paramount of
deregulation from this

The Cause of Global Financial Crisis
в… the causes of global financial crisis
1гЂЃBoom and burst in the housing market
Low interest rates and large inflows of foreign funds created easy credit conditions. Subprime lending contribute to increase the housing demand.This
fueled rising house prices.This housing bubble resulted in quite a few homeowners refinancing their homes at lower interest rates. This led to a
building boom. Easy credit encouraged borrowers to obtain ARM. If borrowers could not make the payments ,they would try to refinance. Refinancing
became more difficult, when house prices began to decline in USA. Borrowers found themselves unable to afford higher monthly payments ,then
default. This places downward pressure on housing prices.
2гЂЃSpeculation ... Show more content on Helpwriting.net ...
в…Ў Explain how the subprime crisis of the US spreads to the whole world?
The subprime mortgage crisis is an ongoing financial crisis triggered by a dramatic rise in mortgage delinquencies and foreclosures in the United
States, with major adverse consequences for banks and financial markets around the globe. Apart from the fact that banks based in other parts of the
world also suffered losses from the subprime market, there are two major ways in which the effect is felt across the globe.
First, the US is the biggest borrower in the world since most countries hold their foreign exchange reserves in dollars and invest them in US securities.
Thus, any crisis in the US has a direct bearing on other countries, particularly those with large reserves like Japan, China and so on.
Also, since global equity markets are closely interlinked through institutional investors, financial crisis affecting these investors sees a contagion effect
throughout the world. The panic psychology takes over and a large number of people cash in their chips. This disturbs global financial market further.
For emerging market countries, in the first place, the crisis derived from the setback in exports of goods and services to the European and American
countries, but not the collapse of the banking system. People claims that the model of crisis transmission in USA is from virtual economy to real
economy, however, the harsh

The Structure of a Financial Crisis Essay
The Structure of a Financial Crisis
INTRODUCTION
The year 2001 had been unlucky for Turkey. Apart from the crisis in 1994 and November 2000, the country had to face another financial crisis, causing
problems in the management of its economy. Why does a country delve deep into financial crisis? What are the possible immediate triggers for both the
current and potential new crises? What precautions should be taken for the key issues like the fragility of the financial and banking system, belated
reforms and privatisation, rampant corruption, exchange rate policy? And how can the governments satisfy the markets and people to undertake these
reforms?
The current crisis has not hit the country overnight. This article ... Show more content on Helpwriting.net ...
However, unlike the Transition Economies, Turkey embarked on a prospective plan to privatise a major part of the public sector in the mid 80's and
laws enacting and enabling the privatisation of the State Owned Enterprises (SOE) in late 1985, was an important breakthrough. In the 1990's
privatisation went ahead but caused disappointment in many sectors. Most privatised firms could not improve their performance and some that
succeeded, had been profitable already as SOEs. But that was not the only problem the country had to face. Turkey had already begun to face
significant problems regarding the Privatisation Policy in the 1990's. These mentioned problems not only aroused from the aggregate demand
concerning the SOE, and the negative effect of investment but the ongoing debate carried by the opposing political parties in the Parliament.
The governments have overcome several difficulties and successfully resumed privatisation in the beginning of the second decade. Though the outcome
was promising, the program proceeded more slowly than the original plan. In 1993 for example, a net revenue of US$ 543 millions was raised through
several privatised firms including two electric companies, two communications equipment manufacturers, a supermarket chain and four cement
factories. In 1994 a total of approximately US$ 412 million was

The Asian Financial Crisis and Thailand: Catalyst for...
During the second half of the 20th century Thailand underwent a rapid transformation from an agrarian to export–driven industrialized economy while
sustaining rapid economic growth. What took Europe almost a century, the East Asian tigers (Hong Kong, Singapore, South Korea, and Taiwan) and
the newly industrializing economies (Indonesia, Malaysia, and Thailand) accomplished in a matter of decades, which led many to believe in an East
Asian miracle. However, in 1997 Thailand became the first country swept into an economic crisis that spread throughout the region within months.
Why did Thailand unexpectedly fall into a rapid economic crisis and how has the crisis shaped the current political economy of the country? Although
Thailand ... Show more content on Helpwriting.net ...
By the end of August, the crisis spread to the Philippines, Malaysia, and Indonesia, which after floating their currencies, experienced sharp
depreciations ensuing an economic collapse. Despite the International Monetary Fund's (IMF) attempts to restore confidence with currency standby
agreements, the crisis spread to Singapore, Taiwan, and Hong Kong. These countries all managed to escape a financial meltdown, but not without
significant currency depreciation. When the crisis forced South Korea, the eleventh largest economy in the world, to devalue the won, the IMF
responded by creating substantial rescue programs for Thailand, Indonesia, and South Korea. However, the programs were unable to prevent the crisis
from deepening. In a matter of months the Asian tigers were reduced to "whimpering kittens."
Early responses to the crisis, fueled by Washington and even the IMF, were that the "dark underside to 'Asian values'" or Asian capitalism, which
promoted a paternalistic authoritarian or single party rule to guide the economy, had failed and was being reprimanded by the free market. However,
both authoritarian and democratic governments fell to the rapid contagion due to institutional weaknesses that created vulnerabilities to international
capital flight. Many of these countries

Spanish Financial Crisis
Spanish financial crisis
Introduction
(source: Wikipedia)
The 2008–2010 Spanish financial crisis is part of the world economic crisis of 2008. In Spain, the crisis was generated by long term loans (commonly
issued for 40 years), the building market crash which included the bankruptcy of major companies, and a particularly severe increase in unemployment,
which rose to 13.9% in February 2009.
Spain continued the path of economic growth when the ruling party changed in 2004, keeping robust GDP growth during the first term of prime
minister JosГ© Luis RodrГguez Zapatero, even though some fundamental problems in the Spanish economy were already self–evident. Among these,
according to the Financial Times, there was Spain's huge trade deficit ... Show more content on Helpwriting.net ...
Spain accounts for 11.5 percent of eurozone GDP while Greece only accounts for approximately 2.5 percent. Spain is the 4th largest economy in the
16 nation eurozone and it is the 10th largest economy in the world. If the economy of Spain fails it will cause a shockwave that will be felt in every
corner of the globe. In fact, there are quite a few analysts that believe if Spain defaults it would ultimately lead to the breakup of the eurozone.
So will the EU step up and bail out Spain? Well, there are rumors that EU officials have begun work on a bailout package for Spain which is likely to
run into the hundreds of billions of dollars, but on Monday the European Commission, the Spanish government and the German government all denied
that the European Union was preparing a bailout for the Spanish economy.
9 reasons why Spain is a dead economy walking
(source http://www.businessinsider.com)
#1) Even before this most recent crisis, unemployment in Spain was approaching Great Depression levels. Spain now has the highest unemployment
rate in the entire European Union. More than 20 percent of working age Spaniards were unemployed during the first quarter of 2010. If people aren't
working they can't pay taxes and they can't provide for their families.
#2) In an effort to stimulate the economy, Spain's socialist government has been spending unprecedented amounts of money and that

Causes of the financial crisis
THE FINANCIAL CRISIS
Preparing the grounds: The role of global macro policies and the poor US regulatory framework Introduction
The financial crisis from 2007–2009 is beeing caused at two levels: global macro policies affecting liquidity and a poor regulatory framework
1
The policies affecting liquidity created a situation like a dam overfilled with flooding water
2
The regulatory system have been the faults in the dam, directing the liquidity into the real estate market
Source: вЂћThe Current Financial Crisis: Causes and Policy Issues" by Adrian Blundell–Wignall, Paul Atkinson and Se Hoon Lee
Introduction
Global macro policies affecting liquidity played a major role in the built up to the finacial and ... Show more content on Helpwriting.net ...
enneth Rogoff
Global imbalances
In the US low interest rates fed into powerful multiplier mechanism
1
Description
2

Comment
Expectations of future housing price appreciation
1
1% increase of current account deficit Г пѓ 10% increase in real estate prices
US home prices rose at double digit rates in 04/05
US mortgage quality declined
"American Dream Housing bubble policy"
3
Financial innovations 2
Source: вЂћGlobal Imbalances and the Financial Crisis: Products of Common Causes" by Maurice Obstfeld and Kenneth Rogoff
1
2
Global macro policies affecting liquidity
The increasing global imbalances
Loose monetary policy by Fed
Source: вЂћThe Current Financial Crisis: Causes and Policy Issues" by Adrian Blundell–Wignall, Paul Atkinson and Se Hoon Lee
Fed policy
The FED overflowed the US economy with cheap money in order to support the economy 1
2
May 2000: 6.5%
June 2003: 1%

Until 2006
Dot–com crash
9/11
Fear of deflation Unchanged rates for one year
Interest rates remained too low (Taylor rule)
Expansion of housing market
Too low interest rates over a too long period was a major cause for the genisis of the housing bubble
Source: вЂћGlobal Imbalances and the Financial Crisis: Products of Common Causes" by Maurice Obstfeld and Kenneth Rogoff
Fed policy
The interest rates set by the fed were far below what the Taylor rule would suggest 1
2

Similarities and Differences of the Great Depression as...
SIMILARITIES AND DIFFERENCES OF THE GREAT DEPRESSION AS COMPARED TO TODAY'S FINANCIAL CRISIS
ABSTRACT The financial crisis which the United States is combating today, in many aspects resembles the characteristics and consequences which
were the outcome of the Great Depression lasting from the time period 1929 till 1933 (Great Depression). The Great Depression of earlier times and the
financial crisis of the current times from 2003–2008 will be studied in depth in the following research work in order to bring out the similarities and
differences the United States faced during these two times of financial turmoil. Particular highlighted areas would comprise of government bond rates,
Gross Domestic Product rates, Interest rates, money ... Show more content on Helpwriting.net ...
13 and did not revive back until 1954. On the other hand in 2008 Dow fell a record high of 14,280 on Oct. 5, 2007 to a low of 10,267 on Monday,
before gaining a little to Friday's close of 10,325. The stagnant incomes in 1929 observed a 4 percent drop in inflation–adjusted disposable income of
agricultural workers whereas the top bracket class observed a steady gain whereas in 2008 (Waggoner J, 2008), inflation–adjusted income for
middle–class workers dripped by 1 percent. The concentration of wealth in 1929 was mainly in the hands of stock speculators (Tomkins L M, 2008)
whereby the richest 1 percent of Americans owned approximately 40 percent of the country's wealth. However the current figures reveal that in 2008
the richest 0.1 percent of Americans constitutes only 11.6 percent of the total nation's income (Calbreath D, 2008). As per the information given by
Amity Shale's in her "The Forgotten Man: A New History of the Great Depression", November 1933, figures reveal that unemployment rate had
increased to over 23% whereas in the current times it's just 5%.
GOVERNMENT BOND RATES Stocks performed very badly during the Great Depression but on the contrary government bonds did fairly well.
During depression Bond prices did rise tremendously as bond yields came down sharply. For example, the prime corporate bond output level fell from
4.59% in September 1929 to 3.99% in May of 1931. By June of 1938

The Global Financial Crisis And The Crisis Essay
Introduction
The Global Financial Crisis, also known as The Great Recession, broke out in the United States of America in the middle of 2007 and continued on
until 2008. There were many factors that contributed to the cause of The Global Financial Crisis and many effects that emerged, because the impact it
had on the financial system. The Global Financial Crisis started because of house market crash in 2007. There were many factors that contributed to the
housing market crash in 2007. These factors included: subprime mortgages, the housing bubble, and government policies and regulations. The factors
were a result of poor financial investments and high risk gambling, which slumped down interest rates and price of many assets. Government policies
and regulations were made in order to attempt to solve the crises that emerged; instead the government policies made backfired and escalated the
problem even further.
Subprime Mortgages
The housing market crash, which broke out in the United States in 2007, was caused by high risk subprime mortgages. The subprime mortgage crisis
resulted in a sudden reduction in money and credit availability from banks and other lending institutions, which was referred to as a "credit crunch."
The "credit crunch" and its effect spread across the United States and further on to other countries across the world. The "credit crunch" caused a
collapse in the housing markets, stock markets and major financial institutions across the globe.
Subprime

Financial Crisis Rebirth
Rebirth of the U.S. Economy during the Financial Crisis
Liberty University
July 8, 2016
Rebirth of the U.S. Economy during the Financial Crisis
Introduction A financial crisis is a condition, for various reasons, an organization or organizations lose a vast part of their worth. In many segments of
the economy, a financial crisis happens all the time. The terms financial crisis and economic crisis are not interchangeable. The total economy is
affected by an economic crisis. A financial crisis may only affect one part of the economy and not have any effect on the other parts of the segments.
The financial crisis which began in 2007 was the beginning of a downward spiral for the United State economy ... Show more content on
Helpwriting.net ...
The unemployment rate increased from four and a half percent to nearly ten percent in the United States. The Big 3 automakers, especially GM were
hit hard by layoffs and production globally. Dealerships, worldwide, had to lay off workers as well. From the later part of 2008 to mid–2009,
approximately 38.5 percent of homeowners were not employed. The financial crisis saw the worst unemployment rate since the Great Depression of
1929–1939. More than 15 million workers were unemployed. Approximately 9.5 percent of Americans were employed part time in order to provide for
their families. The highest unemployment rate was recorded in the state of Michigan at more than 15 percent. Unemployment among African
Americans was almost 16 percent; while unemployment among Latinos reached more than 13 percent. The American Recovery and Reinvestment Act
created nearly two million jobs in 2009. This Act was a part of the stimulus packet signed by President Obama in 2009 to boost the economy. Without
government intervention, the economic recovery could have been more devastating and lasted for many

Were Business School to Blame for the Financial Crisis?...
Were business school to blame for the financial crisis?
What should business school do to help prevent similar crisis in the future?
All over the world, global financial crisis is considered as one of the worst economic recessions, which has affected other countries in several parts of
the world. Many people claim that business school is nurturing their students with less regard for the social responsibility and sustainability of a
business success than there should be.
The argument concerning the academies of the apocalypse has been widely discussed in terms of the effect on financial predicament due to an
inadequate preparation of business education. This essay will presents a various points of view about whether business school ... Show more content on
Helpwriting.net ...
Similar to Gempesaw (2009, p.333) citing Curtis's views on the economic recession that greed and the lack of ethical behavior can bring about
mismanagement and lead to the current economic slowdown. He complains about business education that it only focuses on maximizing shareholder
value rather than the importance of social responsibility, which should be considered as essential as profit margin and growth. Hence, this profit
maximization should not be considered as the only one aspect to succeed in the business organisation.
In contrast, there has been a plenty of opponent presenting an opposite side on the view of business school curriculum. Some critics argue that a
number of business programmes consist of social discipline including an understanding of ethics and corporate social responsibility (CSR), which are
essential to business leadership. David Crowther, professor of CSR at Leicester school, states that the study of CSR has been instilled in the course
before the problem of financial collapse (James, 2009) Although some of the current dilemmas may have stemmed from an underemphasis on CSR and
business ethic, Willmott (cited in James, 2009) argues "The financial crisis was not solely due to our graduates from 15 to 20 years ago". Moreover,
Warnes (2012) points out on the structure of business education in many schools, which tend to compress and change their programmes to be flexible
in order to cope with this severe economic situation. Regarding the growth

The Financial Crisis Of 2007
The most recent financial crisis of 2007 was felt throughout the world, and brought about huge economic consequences that are still being felt to this
day. Within the United States, the crisis undoubtedly resulted in a surge in poverty and unemployment, a significant drop in consumption, and the loss
of trust in the capitalist economic system. Because of globalization, this crisis was felt through the intertwined global markets, affecting underdeveloped
countries even more. Historical events from the past have taught us that financial crises such as the one we suffered during 2007 have occurred a vast
number of times. From Mexico to Thailand, these financial crises have resulted in contagion worldwide, and have caused governments to ... Show more
Banks would lend money to these prospective home buyers without checking the amount of incoming and concurrent assets that they owned in
order to see if they would be able to repay the loan. These loans were then pooled and sold off to government financial institutions such as Fannie
Mae and Freddy Mac. Slowly, the homeowners were unable to repay their loans, which forced them to either sell their homes at a lower price or
foreclose, between September 2008 and September 2012 alone, 3.8 million U.S. property owners lost their homes (Balaam, 196). This severely
increased the mortgage loss rates for both lenders and investors; it became known as the subprime mortgage crisis. Eventually, government financial
institutions whom had bought these pooled mortgages filed for bankruptcy soon after, which had a chain–effect reaction throughout the entire
economic system both in the U.S. and around the world. Thus, it created what is now known as the most recent financial crisis. The U.S. government
immediately issued emergency loans and tried to increase the money supply, they extended these emergency loans to over 700 banks in order to
incentivize home, student, auto, and small business loans (Balaam, 194). By the end of 2008 the stock market in the United States and Europe had
suffered loses of over 40%; losses that until recently have recovered (Balaam, 194). The economic crisis resurged feelings of loss and insecurities that
were to some

1930s Financial Crisis
The world economy has faced two major financial crises in its time and their effects are still rippling through the world economy till now. The Great
Depression of 1930s had a worldwide economic crisis effect that led to a widespread unemployment, a halt in industrial production and construction
and a decline in stock prices. The world economy barely came out of the effects of the Great Depression and was performing fairly well when it again
faced another financial crisis of the 2000s.
To classify root causes as to why financial crisis occur, one needs to go follow a systematic approach to this problematic situation. Be it human related
failures or bank regulators failures, the financial crisis was unavoidable considering the ongoing circumstances.

What Is A Financial Crisis?
What is a financial crisis? According to Mishkin and Eakins (2015), "a financial crisis occurs when information flows in financial markets experience a
particularly large disruption, with the result that financial frictions and credit spreads increase sharply and financial markets stop functioning. Then
economic activity will collapse" (p.165). Throughout history the United States of America has experienced six significant financial crises. Each crisis
left the United States of America's economy is disarray.
Furthermore, many economists believe that a major economic crisis occurs about every seven years. Consequently, this raises the question, should the
United States Government bailout financial institutions during an economic crisis? ... Show more content on Helpwriting.net ...
According to the Department of State Office of Historian, "During the 1973 Arab–Israeli War, Arab members of the Organization of Petroleum
Exporting Countries (OPEC) imposed an embargo against the United States... The embargo both banned petroleum exports to the targeted nations and
introduced cuts in oil production". The embargo lead to a shortage of oil, increased oil prices per barrel, lead to the devaluation of the U.S. dollar and
caused a global recession.
The third financial crisis faced by the United Sates was the recession of the 1980's. Sablik (2013), states that the main reason for the recession of the
1980's and the leading factor for this financial crisis was caused by the chairman of the Fed, Paul Volcker. "(Volcker) felt strongly that mounting
inflation should be the primary concern for the Fed: "In terms of economic stability in the future, [inflation] is what is likely to give us the most
problems and create the biggest recession" (Sablik, 2013). Volcker's aggressive tactics back fired and lead to high unemployment rates and high interest
rates.
The fourth crisis was Black Monday, the stock market crash of 1987. According to Colombo (2012), During this time the Federal Reserve raised
interest rates to try and control inflation. This did not sit well with individuals who were invested in the stock market. So, in order to secure their funds,
they invest in portfolio insurance to counter

Cyprus Financial Crisis

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