2008 financial crisis

Essay by burak21 November 2014

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Burak Çetin

MSc International Business

IBS, Budapest

8 November , 2014

2008 Financial Crisis

Bank failures, billions of dollars soared, global growth lowered, impotent governments. Financial

capitalism is in crisis.Media loop line numbers of the crisis, the stock market falls, the huge losses

of some banks without necessarily really explain What is happening in simple terms. But what are

the reasons of the global financial crisis? . And could it prevent ? The main cause of the crisis is the

collapse of the US mortgage market. About four years ago the banks and the US government began

to give a lot of loans for the purchase of property, financial liberalization occurred.

In its report on the world economy, the International Monetary Fund does not mince words and

defines the economic crisis of recent months (in 2008) as "the worst since the 1930s." The Fund

describes a global economy slowing down, at a pace that many experts consider the edge of

recession because of the most dangerous financial shock in advanced economies from the thirties.

For many years, central banks have proposed rates' extremely low interest pushing many people

into debt for the 'purchase of the house of' car, etc ( Ouarda ,2010).

Suddenly, in a few months, the bankers have begun to raise interest rates to put into serious

difficulties that many families, especially in the US, have not been able to pay the installments of

their mortgage and so they lost the property purchased . Many people have found themselves

suddenly poor, the salary was suddenly insufficient for their needs, even basic ones, and so the

'economy began to "turn" less. Less money and fewer purchases in a short time they sent in crisis

many companies have been forced to close or lay off workers due to lack...