Financial crisis of 2007–2010
The financial crisis of 2007–present is a financial crisis triggered by a liquidity shortfall in the United States banking system.
It is considered by many economists to be the worst financial crisis since the Great Depression of the 1930s.
It contributed to the failure of key businesses, declines in consumer wealth estimated in the trillions of U.S. dollars, substantial financial commitments incurred by governments, and a significant decline in economic activity
Responses to financial crisis:
The U.S. Federal Reserve and central banks around the world have taken steps to expand money supplies to avoid the risk of a deflationary spiral, in which lower wages and higher unemployment lead to a self-reinforcing decline in global consumption.
U.S. Federal Reserve, the European Central Bank, and other central banks purchased US$2.5 trillion of government debt and troubled private assets from banks.
The governments of European nations and the USA also raised the capital of their national banking systems by $1.5 trillion, by purchasing newly issued preferred stock in their major banks.
Lessons learnt:
The collaboration of many governments in the world and banks that caused the fast relief of the economic crisis shows that inter-government collaborations can solve big problems that threatens the world.
Possible crisis in the future:
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