FIN 190 Asian Currency Crisis The Asian currency crisis of 1996-97 brought to light the dangers of financing massive amounts of debt in a foreign currency which the domestic currency is pegged to. It also illustrated how developing countries are ill prepared to cope with such large scale financial issues. The projected continued growth in the Asian markets was built heavily on exaggerated predictions. Between 1990 and 1996 the area witnessed an exponential development period
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Global Economic Crisis The global financial crisis (GFC) or global economic crisis is commonly believed to have begun in July 2007 with the credit crunch, when a loss of confidence by US investors in the value of sub-prime mortgages caused a liquidity crisis. This, in turn, resulted in the US Federal Bank injecting a large amount of capital into financial markets. By September 2008, the crisis had worsened as stock markets around the globe crashed and became highly volatile. Consumer confidence
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09-093 July 22, 2009 The Global Financial Crisis of 2008 – 2009: The Role of Greed, Fear and Oligarchs Cate Reavis Free enterprise is always the right answer. The problem with it is that it ignores the human element. It does not take into account the complexities of human behavior. 1 —Andrew Lo, Professor of Finance, MIT Sloan School of Management The problem in the financial sector today is not that a given firm might have enough market share to influence prices; it is that one firm or a
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In the years leading up to the crisis, high consumption and low savings rates in the U.S. contributed to significant amounts of foreign money flowing into the U.S. from fast-growing economies in Asia and oil-producing countries. This inflow of funds combined with low U.S. interest rates from 2002-2004 resulted in easy credit conditions, which fueled both housing and credit bubbles. Loans of various types (e.g., mortgage, credit card, and auto) were easy to obtain and consumers assumed an unprecedented
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place in political, economic, financial and socio-cultural circles. Political changes especially the Arab spring have had far reaching impact on the airline sector with fall in passenger numbers to these destination as well as the rise in fuel prices negatively impacting the growth of the industry, political instability in other areas as well as laws regulating the airline sector have been on the rise as countries seek to protect local airlines, the economic crisis slowed down the growth of the
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Instructor Date The economic crisis that struck the world between 2008 to 2009 had such resounding adverse impacts that brought even the mightiest economies to its knees. Even at present, the far-reaching effects of the crisis remain almost palpable and may be seen in high unemployment rates, economies still in recession and seemingly insurmountable national deficits. The United States, where the crisis had its beginnings continues to suffer from the recession even
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The Next Financial Crisis According to the Economic Times, a second Asian Financial Crisis is on its way. The two giants of Asia almost seem to be competing with one another to become the cause of the next global financial crisis. Between China and Japan, Japan will most likely trigger the crisis. Japan is inflating its money supply three times faster than the Fed’s QE program. It is weakening the yen as intended and exporting deflation to its customers, making them less competitive. According
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The Asian Economic Crisis The Asian Economic Crisis of 1997 was a regional debacle that stirred and involved practically the rest of the world. It was a unique economical situation that no one expected or suggested. The southeastern Asian countries, such as Thailand, South Korea and Indonesia were financially sound and satisfied all the criteria that economists proclaimed necessary to maintain order and progress. However, economists and the rest of the world did not see the breaches in the
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arising from the international economic crisis originating from the initial disaster in the United States has affected the vast majority of countries in one way or another. The amount of influence ranges from economic devastation of some nations at one end of the spectrum to national growth and prosperity at the other. In order to deal with the global crisis, countries have used an array of economic policies and programs in order to either revive their failing financial system or to maintain momentum of
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5/4/15 The Great Recession: The Financial Crisis of 2008 Table of Contents: I. Introduction......................................3 II. Cause & Effect of the Housing Bubble..............3 III. Financial Industry................................5 IV. Global Contagion..................................6 a. European Sovereign Debt Crisis of 2007-2008.....7 V. LIBOR.............................................8 b. LIBOR & the Crisis in Lending...................8
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