(i) briefing on the 2008 financial crisis
Hello, i'm the king of the book. Today, the prince talks about the 2008 financial crisis。
In fact, the financial crisis of 2008 should be a “subprime crisis” precisely, and what is a “subprime crisis”
The so-called “sub-prime crisis” is a short word of the “sub-prime mortgage crisis”, which is generally believed to have originated in the united states, with the collapse of sub-prime mortgage institutions, resulting in the forced closure of investment funds, and stock market shocks, which have led to a lack of liquidity in the global financial markets and to financial market distress worldwide。
Perhaps the above phrase is somewhat retroverted, and the general public cannot understand it. The "subprime mortgage crisis" is simply a question of the inability of the bank to recover the loan, and the inability of the lender to repay the loan, which ultimately raises a massive social credit problem。
The sign of the real outbreak of the subprime crisis, or a real sign, was the bankruptcy of the lehman brothers, one of wall street’s four largest investors, in 2008。
As to the extent to which the financial crisis has cost the united states and even the world economy, the prince believes that this issue can be considered in three ways:
In the wake of the united states financial crisis, a large number of financial institutions have suffered huge losses, and stock prices have fallen sharply, with a direct impact on stock markets。
As a result, the united states mortgage was taken over by its two giants, remy and emeritus; the largest company in the world, the united states international group, sought government protection; the five major united states investment banks were hit hard; and the bankruptcy of lehman brothers, one of the four largest investment banks in the united states, marked the end of the 2008 subprime crisis that dragged the united states into a serious financial crisis that had been rare since 1929。
2. The volatility of major international financial markets has intensified。
As his royal highness said, after the full-blown financial crisis in the united states of america, the world was swept away from new york in the united states to london in the united kingdom, from paris in france to frankfurt in germany to tokyo in japan, and the stock markets of the major western economies were in turmoil。
The financial crisis has spread from the financial sphere to the real economy。
Economic growth in asia was 6 per cent lower in 2008 than in 2007 7. 5 per cent, as a result of adverse factors such as reduced demand for exports and a credit crunch, a figure that will drop significantly to 4. 9 per cent in 2009。
So many economists or scholars directly compared the subprime mortgage crisis to the great depression of the us in the 1930s (started in 1929)。
(ii) why did the subprime crisis erupt
Then one might ask why the subprime crisis broke out in 2008 in the united states, and what is more confusing is why the subprime crisis occurred in the united states, and why the global financial crisis finally erupted. Now, let's just talk about it。
Indeed, the subprime crisis was not an accident; rather, it was a inevitable event, since the financial environment at the time had been “sustained” and the financial crisis had finally erupted。
As to the specific reasons, the mainstream views are as follows:
1. Easier credit conditions and growing housing bubbles
2. The aggressive financial policy of wall street and the spirit of luck
3. Abuse of financial derivatives on wall street
4. Failures by regulators, credit rating agencies and policy failures
5. The united states government is insufficiently aware of the crisis and unable to deal with it。
However, the former governor of the people's bank of china (the central bank), zhou xiaochuan, spoke freely from the perspective of the “technological community” at the global finance forum in may 2018, focusing on reflection and research on the tenth anniversary of the financial crisis。
He described two points made by china during the bis (bank for international settlements) and imf (international monetary fund) discussions in the fourth quarter of 2008, during which the crisis was discussed:
I. The economic crisis is linked to some activities and products in the financial markets, some of which are derived from cold products, which are isolated from the real economy and can easily rise and fall
Second, in the system of economic and financial markets, positive feedback features tend to be too strong, for example, when the economy is good, stock prices are good, profits are good and ratings are good. But when things go wrong, there's a lot of downside, which is typical positive feedback。
(iii) how much does ordinary americans lose
The last question: how much did americans lose after the subprime crisis in 2008? Although there had been no data before, the prince had recently found that, this year, on the tenth anniversary of the financial crisis, the federal reserve (the united states central bank) had issued a report in august, which showed that the 2008 financial crisis had cost the united states $70,000 per capita
In a new study recently conducted by the san francisco federal reserve, it was estimated that the collapse of the real estate market in 2008 and the ensuing economic downturn had resulted in an average loss of $70,000 per american in lifetime income。
In addition, researchers have stated that the financial crisis has also hampered the growth of inflation-adjusted gross domestic product (GDP), and even after 10 years, these experts have indicated that it is still doubtful whether the united states will recover these lands today。
For example, adam tooze, a british historian and professor at columbia university, in his latest book collapse: how the 10-year financial crisis has changed the world, stated that while most people now accept that the financial crisis is over in 2018, this may not be the case。
For tuze believes that, while 10 years have passed since the 2008 financial crisis, it is still essentially determining the way the financial system operates, owing to some political decisions and interventions by central banks, in other words, that the 2008 financial crisis did not “restore” normality。
In conclusion, the prince would like to say that the so-called “history is the basis for awareness”, especially in the special year 2018, the tenth anniversary of the financial crisis, should be a time for the united states and the countries of the world to learn from history in order to avoid possible factors and events that could lead to a crisis, especially the housing price and the housing bubble
