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Examine the Factors Leading to the Global Financial Crisis of 2008/10. Evaluate the Impacts of This Crisis on Either a) a Country of Your Choice or B) a Business of Your Choice.

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Examine the factors leading to the global financial crisis of 2008/10. Evaluate the impacts of this crisis on EITHER a) a country of your choice OR b) a business of your choice.
In this assignment I will be discussing the factors that caused the global financial crisis of 2008/2010 and will be evaluating the impacts of the crisis on the UK economy. Firstly a recession is defined as a period of negative economic growth for two consecutive quarters. This means there is a fall in National Output and National Income. Inevitably a recession will involve higher unemployment and an increase in government borrowing. (Economic help, 2008, www.economicshelp.org, accessed on 24/11/2010) The financial crisis of late was caused by factors including, subprime lending, complex financial systems, greed, high oil prices, globalization and the collapse of the Lehman brothers. All of these factors will be explored throughout.
Subprime mortgages are a big factor when talking about the recession, Justin Pritchard states that subprime refers to a borrower that is not prime. These are borrowers who might be less likely to repay a loan and therefore default. Subprime borrowers may be classified as subprime. Banks offered loans to people in the subprime category often putting more interest on the loans as they are a greater risk for the bank however the banks were happy to take on the risk as they could receive a greater interest rate back. These subprime mortgages were to have a big impact on the banks. As these loans raised interest rates and the borrowers struggled with repayments. Therefore many mortgage companies lost money and became bankrupt. (Economic help, 2008, www.economicshelp.org, accessed on 24/11/2010) The subprime mortgages in the US became out of hand and Federal Reserve chairman Ben Bernanke predicted that the US sub-prime crisis could cost up to $100bn. (BBC, 2009,

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