The document summarizes the global recession that started in 2008. It began with defaults on housing loans in the US, which caused liquidity issues for financial institutions and investment banks. This spread to other markets as these institutions withdrew investments from developing countries. As demand slowed in the US, it impacted other economies. The recession affected many nations as growth rates declined and some required IMF aid, with casualties seen worldwide as the slowdown process gripped the global economy.

1. PRESENTED BY, PRIYA.S PREETY. RECESSION AROUND THE WORLD

2. 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.

3. 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.

4. 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

5. 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

6. 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

7. 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

8. 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

9. 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

10. THANK YOU ONE N ALL!