Global Financial Crisis: Causes & Consequences

Abstract

The period of economic boom, a financial bubble—global in scope—has now burst. The global financial crisis, brewing for a while, really started to show its effects in the middle of 2007 and into 2008. Around the world stock markets have fallen, large financial institutions have collapsed or been bought out, and governments in even the wealthiest nations have had to come up with rescue packages to bail out their financial systems. On the one hand many people are concerned that those responsible for the financial problems are the ones being bailed out, while on the other hand, a global financial meltdown will affect the livelihoods of almost everyone in an increasingly inter-connected world. The problem could have been avoided, if ideologues supporting the current economics models weren’t so vocal, influential and inconsiderate of others’ viewpoints and concerns. The paper enlighten the facts regarding the major financial crisis like- Housing prices, Global saving glut, The financial turmoil of 2007-20, Securitization, Liquidity crisis, Mounting of oil prices and also fragment the facts of financial crisis with the help of the comparison between the average of previous recessions since 1950 to the Current recession (as of April 2009).