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A major issue facing politicians today is the economic crisi

The global economic crisis that hit the world in 2008 was caused by an interaction of economic and financial factors, and restoring health to the financial sector requires a determined policy response from politicians.

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A major issue facing politicians today is the economic crisis. In 2008, the global economic arena had collapsed at a speed similar to, or even greater than, that during the Great Depression. This resulted in a fall in world stock markets, buy outs of financial institutions, massive unemployment and a slowdown in global economic activity. The primary reasons for the global economic crisis were: (1) excessively low interest rates; (2) poor risk management and excessive debt; and (3) global economic imbalances. When the bubble burst in 2008, the entire economic system moved into reverse. The markets dried up, the dollar lost value, and suddenly the liquidity was gone. The economic crisis is still impacting society, and is a major issue facing politicians today.

Two main effects of the economic crisis that impacted all ...

Solution Summary

In 2008, the global economic arena had collapsed at a speed similar to, or even greater than, that during the Great Depression. This resulted in a fall in world stock markets, buy outs of financial institutions, massive unemployment and a slowdown in global economic activity. The solution discusses this economic crisis.

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