Global Financial Crisis Problems

Introduction In the beginning of 2007, the United States of America woke up to the financial crisis caused by the events in its housing market. This rapidly spread to other major world economies due to the international interbank relations that included interbank lending and so on. Major financial institutions failed the financial stress test and this led to a widespread panic among many firms.Advertising We will write a custom assessment sample on Global Financial Crisis Problems specifically for you for only $16.05 $11/page Learn More Smaller economies such as African countries and some Asian economies also felt the impact of the financial crisis and this led to a decrease in their economic growth rates (Economic Commision for Africa 3). This paper discusses the problem created by the global financial crisis and assesses the viability of the courses of actions taken to counter the problem. Issues caused by the financial crisis The financial crisis pain s were felt in practically all countries of the world. International financial sector was temporarily thrown into chaos as there was a breakdown of trust among many financial sector players. This resulted in a complete freezing of interbank lending which subsequently forced a collapse in the global securities exchange. The crisis also meant that developing countries’ economies recorded a negative growth. The growing economies’ stock market’s volatility went high and this resulted in significant loss of wealth in their stock markets. The crisis also caused a huge decline in the commodity prices of goods exported to the major economies such as Europe and America. The volume of Africa’s exports also went down because of the crisis. This was caused by retarded growth of the major export markets i.e. China, Europe, and the United States of America. This slow pace their economic growth meant that the demand for Africa’s exports went down resulting to Afr ican countries becoming net importers. Action plans to tackle the effects of the crisis Many countries have taken measures that are aimed at cushioning their economies against the negative effects of the global financial crisis. Monetary and fiscal policies have been the most common approaches among many countries in trying to reduce the negative effects of the financial crisis (Michael 28). Countries have moved to recapitalize financial institutions. This is aimed at ensuring that the financial institutions’ financial positions are strong to withstand liquidity problems. Some countries have enacted regulations that are aimed at doubling and even tripling the minimum capital requirement for financial institutions such as banks. This ensures that the banks financial positions with regard to liquidity are at a secure level.Advertising Looking for assessment on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More The gover nments’ measures taken to curb the adverse effects of the crisis through monetary policies have however been largely criticized as non visionary steps that are aimed at saving current situations at the expenses of future’s (Economic Commision for Africa 4). This is because major steps taken in the short-run results in long-run inflation problems. Governments that have reduced taxes to increase consumption by their citizens often create future problems of inflation. Most of these measures taken or that are being considered involve financial commitments. Most of the developing economies face the financial constraint in that they have limited resources to commit to all these causes of actions (Michael 29). This has caused a lack of sustainable solution in tackling the negative effects of the crisis. This situation is rapidly turning from a financial crisis to a potential humanitarian crisis. Conclusion The effects of the global financial crisis need to be addressed region ally and internationally since single government measures prove to be insufficient. Smaller and emerging economies also need a great deal of help so as to prevent the effects of the financial crisis from turning to a humanitarian crisis. If these measures are taken, the viability and sustainability of the courses of actions will become more achievable to both the developing and developed economies. Works Cited Economic Commision for Africa. â€Å"Meetings of the AU Conference of Ministers of Economy and Finance and ECA Conference of Ministers of Finance, Planning and Economic Development.† Twenty-eighth meeting of the Committee of Experts (2009): 2-15. Michael, W. â€Å"Macroeconomics of the Global Financial Crisis: Monetary and fiscal Responses.† Oxford review of Economic Policy 26.1 (2010): 32. This assessment on Global Financial Crisis Problems was written and submitted by user Paige Key to help you with your own studies. You are free to use it for research and reference purposes in order to write your own paper; however, you must cite it accordingly. You can donate your paper here.

Virginia vs Mass Bay Colonies (93 DBQ) essays

Virginia vs Mass Bay Colonies (93 DBQ) essays Although New England and the Chesapeake regions were settled largely by people of English origin, by 1700 the regions had evolved into two distinct societies. The differences between the two societies are as follows: In 1607 a group of merchants established Englands first permanent colony in North America at Jamestown, Virginia. They operated as a joint-stock company that allowed them to sell shares of stock in their company and use the pooled investment capital to outfit and supply overseas expeditions. This joint stock company operated under a charter from King James I with a concern for bringing Christian religion to the native people. However, most of the settlers probably agreed with Captain John Smith that the real aim was profit rather than religion. Profits were elusive in the early years; expectations of gold and other minerals, trade with Indians for beaver and deer skins were not to be had by the colonists. Many Virginia colonists died of dysentery, malaria and malnutrition. The Virginia Company sent a diverse collection of people to Jamestown; there were artists and glassmakers, as well as unskilled servants. Both types of people adapted poorly to the wilderness conditions. Relations between the colonists and the Indians were bitter from the beginning. John Smith dealt with the Indians by shows of force and the Indians withdrew trade with the English. Many settlers died of starvation in the first years. The discovery that tobacco would grow in the Chesapeake region was a salvation for Virginia. The planters shipped the first crop in 1617 and thereafter tobacco cultivation spread rapidly. By 1624, Virginia was exporting 200,000 pounds of tobacco; by 1638 the crop exceeded 3 million pounds. The cultivation of tobacco caused Virginias planters to find a reliable supply of cheap labor. To fill this need, planters recruited immigrants from various countries. These immigrants were called indentured servant...