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Finance Assignment: Financial Crisis

   

Added on  2020-06-06

9 Pages2160 Words70 Views
FINANCE

TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1MAIN BODY...................................................................................................................................1Introduction of financial crisis................................................................................................1Underlying factors of financial crisis 2007-08.......................................................................1Behaviour of different financial institutions using more functions........................................5Will financial crisis arise in the future ?.................................................................................5CONCLUSION................................................................................................................................6REFERENCES................................................................................................................................7

INTRODUCTIONThe problem and situation in which specific assets of financial are lost up to the largerextent of their nominal value is considered as the financial crisis. Due to this particular condition,overall economy and its local community highly influences in negative manner. In the centurieslike 19th and 20th there are many crises of financial occurred in the world which are related to thebanking, financial institutions and recessions. The present study is talking about the financialcrisis 2007-08 which mainly associated with the property and mortgages. Underlying factors dueto which this crisis comes into consideration in year 2007-08 are explained in the present project.Beside this, behaviour of various institutions are also described which lead to create financialcrisis. Apart from this, it has been forecasted that, in the upcoming times or future financial crisiswill occur or not. MAIN BODYIntroduction of financial crisisIn the economy when huge part of financial asset lost and create negative impact on itsgrowth then it considered as financial crisis. Due to such kind of crisis in the country or world,people unable to gain income and generate profit by which they cannot contribute in growth rateof the economy. When talking about the stock market then it is also highly affected throughfinancial crisis. Therefore, return on the investment made by shareholders also reduce up to thegreater level. There are different kinds of financial crisis occur in the country which are likecurrency, banking, sudden stop, debt etc. (Garcia-Appendini and Montoriol-Garriga, 2013). Thefinancial crisis 2007-08 was related to the banking in which commercial banks give huge amountof loans to the people. There are several kinds of problems which lead to incur condition offinancial crisis in the year 2007-08. One of the major issue by which this situation created isbank gives huge amount of loans to the people. Underlying factors of financial crisis 2007-08Behind creating situation of the financial crisis in the year 2007-08, there is wide range offactors contributed. When such elements come into consideration within country then lead tocreate issue of the crisis. The crisis of this decade is of the banking type in which overall fault isof the commercial banks. These institutions are created huge money but not able to use in proper1

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