Finance

Finance

Financial market crisis

NASDAQ

Attributes and predictors of recessions

The Bank of England, central bank of the United Kingdom

2008 economic crisis in Asia

Shanghai Stock Exchange Building

China

In China, a struggle was underway to see who would swallow the losses on US Agencies and Treasuries. On November 9, 2008 China announced a package of capital spending plus income and consumption support measures. Four trillion yuan ($586 billion) will be spent on upgrading infrastructure, particularly roads, railways, airports and the power grid; on raising rural incomes via land reform; and on social welfare projects such as affordable housing and environmental protection.

Systemic banking crises

Washington Mutual Tower in Seattle, Washington

A bank run affects just one bank. A banking panic or bank panic is a financial crisis that occurs when many banks suffer runs at the same time. In a systemic banking crisis, all or almost all of the banking capital in a country is wiped out.

Global financial crisis, 2008

Banknotes

The global financial crisis of September–October 2008 is a major ongoing financial crisis, the worst of its kind since the Great Depression. It became prominantly visible in mid-September, 2008 with the failure, merger or conservatorship of several large United States-based financial firms. The underlying causes leading to the crisis had been reported in business journals for many months before September, with commentary about the financial stability of leading U.S. investment banks, insurance firms and mortgage banks.

Bank run

War of wealth bank run poster

2008 Financial Collapse

European Central Bank

Minsky's theory of financial crises

Hyman MinskyHyman Minsky has proposed a simplified explanation that is most applicable to a closed economy. He theorized that financial fragility is a typical feature of any capitalist economy. High fragility leads to a higher risk of a financial crisis. To facilitate his analysis, Minsky defines three types of financing firms choose according to their tolerance of risk. They are hedge finance, speculative finance, and Ponzi finance. Ponzi finance leads to the most fragility.

 

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