The Crisis

In the winter of 1776, the American Revolutionary War announced just a few months ago had problems. The British immediately went to New York and New Jersey to suppress the rebellion, and the mainland troops retreated and on the verge of collapse. That year, at the end of December 23, Thomas Paine gave more inspiration

Of course, this is not the first crisis the world economy faces. A decade ago, a major crisis occurred in East Asia, which quickly became a global financial crisis. After that crisis, there was much debate about the new international financial structure, but it rarely happened - apparently too little. The Financial Stability Forum established a new institution to prevent such a crisis from occurring. But it is also surprising that it was led by several defective economic models and philosophy and that it failed to prevent a more serious crisis than the crisis that plagued the world at the end of the last century There is none.

This is the worst financial crisis since the 1930s. However, the financial crisis of the 1930s was very different from our current financial crisis. The crisis of the 1930s was obviously interrupted by the stock market crash, but real damage was caused by the collapse of the banking system. Many small banks have been eliminated. At that time, they did not have branch banking services. Even if your local bankers are gone, there is no financial source for the community. This seriously hindered the development of the financial system. In addition, there were no deposit insurance at that time, so when banks go bankrupt, people will lose a lot of money. The financial crisis is really focused on the collapse of the banking system and the decline in money supply. The current financial crisis is concentrated in the subprime mortgage market as a whole and is caused by the fact that the collapse of housing prices and the fact that many mortgage securities have not paid the contract amount.

The subprime crisis was the real estate crisis and financial crisis caused by the US default and foreclosure of foreclosures which were the major adverse effects of the world's banks and financial markets. The crisis in the second half of the 20th century occurred in 2007 and revealed ongoing weakness in the regulation of the financial sector and the global financial system. Khatiwada and McGirr (2008) pointed out that there is never a large number of subprime mortgages on the balance sheet of the bank, and it aims to attract foreign-affiliated banks with high investment ratings. The agency closes its own funds and returns the asset assets to the balance sheet. Financial sustainability has many banks, relatively short calendars that can not be managed