Global Financial Crisis 2008

Global Financial Crisis 2008 How do i make more $$$ ? Sub Prime Mortgage Market Interest as low as 1% Investors When Financial Crisis Start? Ten years from 1998 Great Depression September 2008 Sub Prime Lender Insurers Who are involved? Central Banks What Happen During the Financial Crisis EH Iks y= GDP to drop by 2.6% in 2009 ? "S"G"IC" Rate of Unemployed people increase to about Stock prices fall 250% 50% Bussiness closed 2008 312,000 closed 2009 492,000 closed Collapse of housing markets Death! Bankruptey Commit suicide due to no income to support themself and family How US React To The Crisis Libor rates at unprecedented levels Provides liquidity facilities Monetary Policy Committee set the interest rates t stabilize prices How other government react to the crisis China Germany -announced a historic $586billion stimulus package aimed -Hypo Real Estate financing with 500billion rescue package to provide financial assistance -set aside funds for infrastructure construction Soffin begins operation, with power to buy assets and recapitalize firms -greater rebates on taxes charged to exporters When the crisis over? Or still continue? GDP and GDP growth 1211 20.00 10.11 852 15.00 7.19 10.00 5.00 Economy recovery began in mid-2009 2005 2006 2007 2008 2009 03 2010 the fall of economic activity finally bottomed out GDP had contracted by approximately 5.1% ($686 billions) What are the lesson? Agencies be reexamined risk management system needs to be improved investors diligence incentivized How should we prevent this? CAPITAL RATIOS Monetary Policy Better Mortgage Products What is the moral of the story? HUMAN NATURE Piktochart make information beautiful