International Finance

Discuss and analyse the recent credit craunch (global monetary crisis of 2007/8) within an international finance perspective: include the events lead up to the crisis, economic and financial consequences, government responses and lessons to be learnt. Brummer (2008) discover that when the credit crunch first came to public notice in the summer of 2007, no one could put up imagined how long the crises would last, how obscure and damaging it would be, and how much of an impact it would have on so many lives across the western macrocosm. As Whalen (2008) examined, the credit crunch is an economic condition in which loans and investment capital be difficult to confirm hold of. In such a period, banks and other lenders become wary of issuing loans, so the value of borrowing rises, often to the point where deals simply do not get done. This essay will be analysing the key events pencil lead up to credit crunch, the economic and financial consequences and the governments responses. The global financial crisis of 2007/2008 has completely changed the face of the international economies as it resulted in hundreds of businesses on the verge of collapse.

For example, companies such as Lehman Brothers were at a time considered one of the most powerful investment banks in the world have now filed for bankruptcy and numerous other companies have been nationalised. Governments worldwide have had to spend billions to restore liquidity to disquieted economies (Mortgages, 2011). The credit crunch which started in 2008 did not just pop out of nowhere but was the accumulation of a series of events over a long period time. In the posterior parts of 2008 the resulted outcome of all these events erupted and caused significant damage to economies throughout the world. There are several reasons for the financial crisis which started in 2008 and some(prenominal) of the reasons include greediness, housing sector decline and poor trouble of risk and credit (Commission on Growth and Development, 2010). Brunnermeie... If you want to get a full essay, order it on our website: Ordercustompaper.com

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