Explain How Has The 2008 Crisis Affected Your Studies Covering Wealth And Poverty

Many compare the instability of the economy of today to the 2008 financial meltdown. According to author Joel Havemann in 2008 the nation documented the economy as the world’s worst dangerous crisis since The Great Depression since 2007. Afterward in 2008 a deep recession encompassed the world (. However, the 2008 crisis is not the same as the same as today.

Ever since the Recession of 2008, the process of acquiring employment has become extremely challenging and exhausting. After months of searching, a significant amount of job seekers are willing to accept any job offers that will allow them to put food on the tables. If you follow the United States’ economic recovery, you probably know that there are about 10.5 million unemployed Americans and constant debates about how to create more jobs. What you may not know is that there are actually four million open jobs waiting to be filled. So how is it possible and who is there to blame?

Big banks in the middle 2000s were flourishing of the money made from selling the mortgages to big investors. While this was great when the banks were giving money to people who were reliable and were going to pay their mortgages every month. And when the investors were making such a hefty profit they wanted more. This is when Subprime mortgages were widely used, giving less reliable lower credit scores the opportunity to get homes. The banks knew that these people would not necessarily always be able to pay, which was the one of many mistakes (Crash Course.) The banks learned that while it did sometimes work out, the consequences of giving out too many unreliable mortgages can bring the whole nations economy down for the housing market has always been the pillar of the economy. The greed of the extremely wealthy continued to overpower the common sense of the

The economic crash of 2008 was a difficult time for all of the people around us. This situation has impacted our country and what is around even to this day. It was a tough time for a lot of families and big businesses. This stock market crash was one of the worst the United States had ever had. Even to this day we are still trying to repair it what went down. Like the employment of jobs, the cost of our products, and homes that were taken away from families. The economic crash came from nowhere and it was a shock fro mainly families, especially the middle and low income families. This took many homes away from them and the job eventually leaving them with nothing. This had also hurt many foreign countries on their way, did trade and their investments. Many housing companies going down with this and also the way banks were running. Why and how did this all happen? This is one of the biggest economic crash in the United States that is still in the process of being repaired.

The 2008 financial crisis can be traced back to two factor, sub-prime mortgages and debt. Traditionally, it was considered difficult to get a mortgage if you had bad credit or did not have a steady form of income. Lenders did not want to take the risk that you might default on the loan. In the 2000s, investors in the U.S. and abroad looking for a low risk, high return investment started putting their money at the U.S. housing market. The thinking behind this was they could get a better return from the interest rates home owners paid on mortgages, than they could by investing in things like treasury bonds, which were paying extremely low interest. The global investors did not want to buy just individual mortgages. Instead, they bought

Declining price attract people with the easy loan facilities of their banks. And banks are ready with very high risk loans. This excess supply of home inventory placed significant downward pressure on prices. As prices declined, more homeowners were at risk of default and foreclosure. According to the S&P/Case-Shiller price index, by November 2007, average U.S. housing prices had fallen approximately 8% from their Q2 2006 peak and by May 2008 they had fallen 18.4%. The price decline in December 2007 versus the year-ago period was 10.4% and for May 2008 it was 15.8%. Housing prices are expected to continue declining until this inventory of surplus homes (excess supply) is reduced to more typical levels.

The financial crisis of 2008 hit the American economy and the world economy as well. It cost tens of millions of people their savings, jobs, and their homes. For decades the American financial system was stable and safe, but it changed. The financial industry turned its back on society; it corrupted the political system, and plunged the world economy into crisis. It was not an accident; it was caused by an out of control industry, a greedy industry. The crisis has made more damage to society while the industry has made more money.

¬¬¬The time between 2007 and 2009 was devastating for America and most of the world. It marked the greatest depression since the Great Depression and put our economy in turmoil. It also put a massive amount of people out of a job and into debt. Throughout this time, almost everyone hurt, from homeowners to massive corporations that is besides the market of the super elite. During this time that people and companies struggled to keep up, while the elite class was still living life to its fullest.

Financial Crisis between 2007 and 2009 was the worst economic crisis after the Great Depression in 1930s. This crisis was a worldwide crisis as it affected the financial system globally and led to collapse in economy. Financial intermediation is a process of banks that take funds from the depositor and lend them out to the borrower. In the financial transaction, financial intermediary acts as the middleman between two parties. Commercial bank, investment banks, pension funds are the example for financial intermediation. This kind of financial intermediary usually provide mortgage to the lender.

In 2008, the world experienced a tremendous financial crisis which rooted from the U.S housing market; moreover, it is considered by many economists as one of the worst recession since the Great Depression in 1930s. After posing a huge effect on the U.S economy, the financial crisis expanded to Europe and the rest of the world. It brought governments down, ruined economies, crumble financial corporations and impoverish individual lives. For example, the financial crisis has resulted in the collapse of massive financial institutions such as Fannie Mae, Freddie Mac, Lehman Brother and AIG. These collapses not only influence own countries but also international area. Hence, the intervention of governments by changing and

Despite the overall success of the International Monetary Fund and the United States to prevent additional contagion from the Mexican peso crisis throughout the broader global financial systems, the crisis nevertheless proved devastating to the Mexican economy and its population. The devaluation of the peso and capital flight plunged the Mexican economy into a deep recession, national GDP dropped by 6.2% throughout 1995, and multiple banks collapsed as poor quality assets and fraudulent lending practices came to light, forcing the financial sector to bare the brunt of the crisis (Pereznieto, 11). The average Mexican, however, would argue otherwise and angrily proclaim that it was them that suffered the most. Many Mexicans could no longer keep up with the rising interest rates and thousands of mortgages went into default, resulting in widespread repossession of homes. Prices rose by 35%, hyperinflation resulted in a real wage decrease of 25-35%, and unemployment rose to 7.4% in 1995 from its 3.9% pre-crisis the year prior (Pereznieto, 15). In the formal sector, over a million people lost their job, real wages decreased by 13.5%, and overall household incomes plummeted by 30% (Pereznieto, 15). Extreme poverty in Mexico grew to 37% in 1996 from 21% in 1994 (Pereznieto, 16). The growing poverty in Mexico also impacted urban areas more than rural areas (Pereznieto, 15). Urbanites relied on a healthy labor market, good access to credit, and

But, more importantly, the 2008 financial crisis made the US economy, and most of the Western economy, a bad joke. The West's greatest minds, and the West's highest-income nations, did not understand or anticipate the financial disaster the US had created. People all over the world started suffering in 2008 and 2009. They would continue to suffer for years. The "elite" had failed to appreciate or even understand history's economic lessons. Economic theories of the “elite” assumed that a major financial crisis was highly unlikely. They were, of course, wrong.

Marconi (2010) believes that the role played by the institutional investors propagated the financial crises. Institutional investors, which is both, individual or companies do enjoy the benefits of reduced commission preferential regulations. This is due to their large and professional investments. Institutional investors like the mutual funds, pension funds, hedge funds like Magnetar Capital, and Life insurance companies like the AIG and investments trusts contributed to the global financial crises of 2007-2008. This financial crisis also referred to as the great recession was triggered by liquidity problems in the United States economy. Many large financial institutions collapsed according to Geczy (2010). The government had to bail out

Before the financial crisis of 2008 the world was financially safe, stable and solid. Iceland was a beautiful place with a high standard of living. Iceland had the complete infrastructure for a modern society, clean energy, Fisheries with quotas, clean air, food production, healthcare, education, and a low crime rate. This made it an area where people wanted to settle down and start families. Around the world country’s looked up to Iceland’s financial aspect until it all came to a frightening halt. In 2000, the Iceland government started to make harming decision to their economy. They began to allow deregulation which brought on horrible consequences for the environment and the economy. The government allowed for multinational corporations to take over their region. Giant aluminum Smelting plants were built that began to exploit their geothermal and hydroelectric resources. While this was happening the government also privatized or transferred from public to private ownership and control, the three largest banks. These banks began to grow larger and larger until they became more then 10 times the size of the economy, making it extremely difficult for the government to rescue. In just five short years three banks that were basically unknown outside of Iceland before this became huge. These banks were giving out loans to anyone who needed or wanted them which was the cause of the financial crisis of 2008. Before the banks loans were given out to only people they knew could

It all began when Mexico announced to the world that they will not be able to meet their sovereign debt obligation in the summer of 1982. With the rise of large loans to the less developed countries (mainly Latin American countries such as Mexico, Argentina, and Brazil) in the 1970s, this period quickly became to be known as the “lost decade” as many creditor countries were greatly affected by a series of defaults from the debtor countries. In this paper, we will discuss the events that led up to the defaults and the impacts of the crisis. We will also look at how the crisis was resolved and what lessons we can learn from the crisis to prevent it from happening again.