This website uses cookies to ensure you have the best experience. Learn more

Current Financial Crisis And Banking Industry

859 words - 4 pages








Current financial crisis and banking industry
Institute of affiliation
Name


















Current Financial Crisis and Banking Industry
The current financial crisis traces its origin in the United States of America, which has affected many banks worldwide. This financial crisis especially in commercial banks has been very costly and has led to bankruptcy of major banks around the globe. Reinhart etal. (2011) described the financial crisis as an equal opportunity menace, which affects poor and rich countries. The financial crisis derives its origin from the public and private sectors. It comes in various sizes and shapes and it can spread across borders ...view middle of the document...

This shows that inevitable accidents are not only dictated by technology, but also by poor organization as well as unionization in industries in which the system elite have no interest in safety but put profits as their priority. In such organizations, their risk exposure is minimal while the risk faced by the society is high. This is well reflected in the current financial crisis, where the source of initial failure lay in individuals’ appetite to reap huge profits.
An example is the occurrence in the US mortgage market in 2000, where the mortgage lenders relaxed the underwriting standards, making mortgage loans available to everyone including those with low credit rating. Moreover, income standards were also reduced which allowed buyers to acquire higher priced homes without extra income. Such relaxation of income standards for morgages and underwriting standards contributed to the increased demand for property and real estate prices by increasing the number of people eligible for morgages. As a result, the market value of homes increased exceeding the cost of borrowing (Moore & Heidi, 2008).
Disaster Incubation Theory was an idea contained in Turner’s booked called “Man-made Disasters” (Turner & Pidgeon, 1997). The theory is also a theory of accidents like the previous theory and it draws attention to the managerial perspective of disasters. He describes disasters development through various stages which may take many years, where signals about the impending danger are ignored or misunderstood. During the disaster’s initial stage, there are norms and beliefs where there is violation of precautions. Stage two follows and is characterised by organizational exclusivity, informational difficulties, failure to comply with discredited regulations, strangers exacerbating...

Other Papers Like Current Financial Crisis and Banking Industry

Financial Crisis and Comets Hitting the Earth

719 words - 3 pages 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

The Financial Crisis and the Developing World

1072 words - 5 pages the financial problems are the ones being bailed out, while on the other hand, a global financial meltdown will affect the livelihoods of almost everyone in an increasingly inter-connected world. The problem could have been avoided, if ideologues supporting the current economics models weren’t so vocal, influential and inconsiderate of others’ viewpoints and concerns. This article provides an overview of the crisis with links for further

Bursting Bubbles and the Financial Crisis

1363 words - 6 pages In the spring of 2008, the world was hit by the worst Financial Crisis since World War 2. The crisis began during the Reagan administration and concluded a couple decades later with the collapse of the housing bubble. Behavioral Finance defines the term “bubble” as an event occurring before a market crash due to overvalued market prices (Ricciardi 2000). The housing bubble, which grew alongside the stock bubble in the mid 90’s, eventually burst

The Global Financial Crisis and Protectionism

678 words - 3 pages ------------------------------------------------- The Global Financial Crisis and Protectionism QUESTION 1: Why do you think calls for protectionism are greater during sharp economic contractions than during boom periods? * Protection of their own economic industries and to curb job losses * Interdependent economy to lessen the impact of economic loss on food, fuel and property prices * To protect job losses at national producers

Investment Banking Industry In The United States And JP Morgan Chase

3534 words - 15 pages yield on bonds they are holding, and they can also earn substantial capital gains as the value of their bonds increases. When interest rates rise, as they have from early 1999 onwards, double benefits of lower funding costs and price gains on bond portfolios disappear.The current problems investment banking industry is also being reflected by substantial restructuring in the global market. Only a handful of players are recognised as having the

South Africa’s Macroeconomic Performance Before, During and After the Global Financial Crisis of 2007-2008

1045 words - 5 pages The global financial crisis of 2007 – 2008 impacted every nation in the world, but the timing and severity of the impact varied greatly depending on various factors such as the sovereign debt as a percentage of Gross Domestic Product (GDP) prior to the financial crisis, as well as the level of exposure to the Collateralized Debt Obligation (CDO) sub-prime mortgagebacked securities of the different countries. Where governments and banks

Global and Chinese Baler Industry | Report Is a Complete Study Of Current Trends in The Market 2010-2020

616 words - 3 pages Baler Industry, 2010-2020 Market Research Report is a professional and in-depth study on the current state of the global Baler Industry with a focus on the Chinese market. The report provides key statistics on the market status of the Mixing Station manufacturers and is a valuable source of guidance and direction for companies and individuals interested in the industry. In this part, the report presents the company profile, product

To What Extent Has the Financial Crisis Challenged the Notion Economic and Monetary Union Has Been a Success in Economic and Political Terms?

2853 words - 12 pages To What Extent has the Financial Crisis Challenged the Notion Economic and Monetary Union Has Been a Success in Economic and Political Terms? Name: Course: Tutor: College: Date: Introduction Many countries and the world in general have been experiencing financial crisis in one time or another starting from the famous 1930s great depression in USA, 2008/2009 US economic crisis to the most recent one, European economic crisis. This is

B) What Were Some of the Major Causes of the Recent Global Financial Crisis (Gfc), and What Have Been Some of the Ongoing Economic Impacts, Either Globally or Locally in Singapore, of This Crisis?

3419 words - 14 pages significant decline. Not only in U.S., the employment rate of many countries was also affected. In Japan, the unemployment rate was 4% at the end of February in 2008 (EconomyWatch, 2010) and in the United Kingdom; the unemployment rate had been increasing since year 2007 (Tovey, 2014). In addition to the employment rate that was affected by the financial crisis, banking and financial was another sector that was badly affected. Due to the

The Problems and Consequences of Greek Financial Crisis

828 words - 4 pages Brtlt20a.wpd Lesson 20a: The Victorian Novel (Day: 168-170) The Victorian reading public firmly established the novel as the dominant literary form of the era. Virtually the entire literate population consisted of novel-readers. Herbert Spencer, that rigorous apostle of science, exempted George Eliot's works works from his general condemnation of "mere" novels; Newman and Arnold were avid readers of fiction; and Darwin stated in his

Report On Drink Driving And Driver Fatigue; Statistics, Current Laws, Risks/Hazards And Costs (Mental, Physical And Financial)

877 words - 4 pages Drink driving can be defined as the act of operating a motor vehicle after having consumed alcohol (ethanol) or other drugs. Not only is it very dangerous, but it is illegal too. Just because you’ve had a drink or two and aren’t drunk, doesn’t mean that you aren’t affected or will soon be affected by alcohol. Alcohol, being a depressant, does many things to the body such as slowing the brain down, reducing judgment ability

Related Essays

Financial Crises And Banking Regulation Essay

903 words - 4 pages having a crisis is probably not as appealing as getting the optimal allocation. Financial crisis can be good if probably we have a perfect market as Modigliani and Miller would see it. But in our world, our market is not as perfect as one may think. There are costs related to the imperfection of our markets. Therefore if our banks default, there are costs to this. If one bank goes bankrupt, it is not only that bank which goes bankrupt, some other

Great Depression And Current Crisis Essay

1233 words - 5 pages media have often linked the current economic crisis that heightened in 2008 to the great depression which occurred decades ago. Looking at the implications of the great depression and what is happening today, clearly there are several direct similarities between the two economic crises. Through a brief analysis of the two economic scenarios, this paper hence aims to show how they are related. What are the similarities with the current financial

Regulation Of Banking And Financial Market

885 words - 4 pages conduct for the investment service. The typical examples are: * The minimal standard concerning the mandate * The powers of the competent national authorities which establish the cooperation mechanisms in real time to investigate the breach cases of the legislation and prosecute. In addition, it should be noted that Article 5 of Regulation 97-02 (Monetary and Financial Code) also includes the rules of banking industry deontology within the

Financial Crisis And Its Impact On China

1824 words - 8 pages not be affected by a recession in the West and the second, that China would be immune to a recession due to its closed capital account and insulated banking sector primarily depending on deposited and not risky Western financial instruments. Short-term effects on China The international financial crisis has left its mark on China where the changes due to the financial crisis are listed in the table below. The most affected areas are China’s