Financial crises often begin with structural budget deficits that are exacerbated by economic downturns, causing countries to default on loans and investments amid panic. The document discusses several crises: the 1994 Mexican peso crisis after joining the OECD; the 1997-98 Asian financial crisis that began in Thailand and spread to other countries; the 1998 Russian crisis delayed from Asia and caused by oil prices and dollar-denominated bonds; and Argentina's 1999-2002 crisis involving inflation, currency devaluations, and capital flight leading to recession. It also outlines the formation and membership of the G8 and G20 economic groups, and some of their responses to the current global financial crisis through stimulus measures and financial market reforms.

1. Y376 International Political Economy January 20, 2011

5. Depreciation of Asia Currencies

11. Heilegendam Summit in 2007 L to R: Tony Blair, Romano Prodi, Vladimir Putin, Nicolas Sarkozy, Angela Merkel, George Bush, Stephen Harper, Shinzo Abe and Manuel Jose Barroso

12. 2009 L’Aquila G8 “Family Photo” L to R: Taro Aso, Stephen Harper, Barack Obama, Nicolas Sarkozy, Silvio Berlusconi, Dmitry Medvedev, Angela Merkel, Gordon Brown, Fredrik Reinfeldt, Jose Manuel Barroso