The Global Financial Crisis Of 2008 Essay - 1925 Words

Regulation is the process of making rules and legislations, thus creating a sort of supervisory system to be carried out by all firms and individuals. Managers are trusted by customers of financial service firms with their monetary resources, as in most cases clients do not fully understand how their money is being circulated once handed over. Although it can cost billions to pay for regulators to carry out their jobs, firms still pay for these services as it may bring more benefits in the long run as compared to drawbacks. (Arnold, 2012) Every firm or organisation needs regulation to ensure that minimum standards are being observed, to protect the customers and the money they decide to invest in a company. In a broader sense, it is possible for the occurrence of a financial crisis to be associated with financial regulation, or its lack thereof. In this essay, I will be writing regarding the global financial crisis of 2008 that began in the United States (US) and proceeded to affect the rest of the world following its collapse. Without proper regulation, customers would be at a loss. This is because in a financial service company, managers and employees are provided a set information that differs compared to what is known by its clients. The problem of asymmetric information without absolute injunction is that it could potentially lead to a string of other problems that could harm the safety and soundness of any financial transaction, such as moral hazard, facilitatingShow MoreRelatedGlobal Financial Crisis 20083250 Words   |  13 Pages1. Introduction Shah (2010) stated that the global financial crisis which has been brewing for a while has really started to show its effects in the middle of 2007 and into 2008. It started with the default of the subprime housing loans in the United States when its housing bubble burst. It caused a great impact across the globe that first struck down major financial institutions, first in United States and then in Europe, that were directly exposed to the mortgage default risk. After theRead MoreThe Global Financial Crisis Of 2007-20081123 Words   |  5 PagesThe Global Financial Crisis of 2007-2008 is the worst financial crisis since the 1930’s The Great Depression (Reuters, 2009). Even if bailouts of banks by national governments prevented the collapse of major financial institutions, worldwide stock markets continued to drop. Evictions and foreclosures overwhelmed the housing market while severed unemployment embraced the labor market (Baily and Elliot, 2009). This global financial crisis was responsible for the decline in the consumers’ wealth, andRead MoreThe Global Financial Crisis 0f 20081181 Words   |  5 Pages The Global Financial Crisis of 2008-2008: The Role of Greed, Fear, and Oligarchs The global financial crisis of 2008-2009 is considered to be worst financial crisis since the Great Depression of the 1930s. Large financial institutions collapsed, banks received bailouts by the government, and stock markets plummeted as well. In result, people were being denied loans. The housing market became a problem because of financial issues and many people were unable to continue to pay their mortgagesRead MoreThe Global Financial Crisis Of 2007-20082489 Words   |  10 PagesThe Global Financial Crisis of 2007-2008 has been studied by several economists, and different causes have been identified, both primary and secondary, which intensified the overall impact of the crisis. 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As a resultRead MoreThe Global Financial Crisis Of 2008-10 And Its Impact On The Financial Health Of The Institutions999 Words   |  4 Pages The Global financial crisis has been described as the worst financial crisis after the Great Depression of the 1930’s. This was a Financial Crisis and affected terribly the banks of the United States of America. The banks during this time had low capital base and suffered from a serious liquidity crunch. Leveraging was very common at this time. This increased financial instability of the banks called for major changes in the financial regulations by the government. This essay will discuss theRead MoreNarrative Interview : The Global Economic Climate During The 2008 Global Financial Crisis ( Gfc )1083 Words   |  5 Pagesfather, James Trainor as the ideal candidate to provide a comprehensive recount of the global economic climate during the 2008 Global Financial Crisis (GFC). And how his experiences of economic fluctuations and policies during the GFC changed his perspectives and understandings of macroeconomic decisions, as well as their effects on the modern world. At the time of the Global Financial Crisis, James was the Global Head of Employment Tax for the Macquarie Group, one of Australia’s largest investmentRead MoreGlobal Financial Crisis of 2008 in the Movie, How We Got Here840 Words   |  3 PagesThe global financial crisis of 2008 has caused millions of people to lose their homes, jobs and savings, and it nearly resulted in a global financial collapse. It resulted in the threat of total collapse of large financial institut ions, the bailout of banks by national governments, and downturns in stock markets around the world. On top of that, the housing market was damaged, causing in evictions, foreclosures and prolonged unemployment. There were many factors directly and indirectly caused theRead MoreThe Global Financial Crisis That Occurred Between 2007 And 2008 Forced Consumers1468 Words   |  6 PagesThe global financial crisis that occurred between 2007 and 2008 forced consumers to be more concerned about their financial affairs. In order to survive during this period, consumers had to reduce consumption budgets, particularly on unnecessary expenditures (Gilkey and Clark, 2015, p.363). After the recession, when the economy started to grow again, total consumption budget was increased and allocated to less necessary products (Gilkey and Clark, 2015, p.363). The business sector also suffered fromRead MoreEric Helleiner of Understanding the 2007-2008 Global Financial Crisis: Lessons for Scholars of700 Words   |  3 PagesEric Helleiner of Understanding the 2007-2008 Global Financial Crisis: Lessons for Scholars of International Political Economy argues that the IPE scholars of the years leading into the finan cial crisis of 2007 failed to identify the negatives of international capital flows which in turn increased the United States financial bubble. Helleiner argues that IPE scholars could not have predicted the event precisely in regards to timing, but failed to observe obvious problems that came with amplified