Financial Crisis of 2007-2008, Lax Regulations or something Else Essay

Financial Crisis of 2007-2008, Lax Regulations or something Else - Essay Example Financial Crisis of 2007-2008, Lax Regulations or something Else Over the period of time, financial services industry went through extensive de-regulation with many institutions taking benefits of such lax regulations. Changes in regulations resulted into a shift in orientation and business strategies of the financial institutions. The focus clearly shifted towards managing short term performance rather than ensuring long term survival of the organization.( Allen & Snyder, 2009) Regulations alone however, cannot be termed as the reason for the financial crisis as there were multiple factors at play. Though lax regulations played their part but the changes in business strategies, changes in accounting standards, loose monitoring from the supervisory authorities, efficient market hypothesis as well as other factors were can be evaluated for their possible impact on the crisis. In this part of the paper, it will be argued that lax regulations were not the only reason for the financial crisis which emerged during 2007-2008. Financial crisis of 2007-2008 is considered as one of the worst economic and financial crisis since great depression of 1930s. The sheer size and intensity of the crisis has made it global because not only the developed countries were affected by the crisis but also the other developing countries were subject to crisis also. Besides creating the threat of the complete collapse of the leading financial institutions of the world, it also resulted into governments intervening by bailing out the financial institutions as well as other organizations.... The after effects of the financial crisis forced many developed countries to actually enter into strict austerity measures to deal with the growing public debt and fiscal deficit issues.( Aalbers, 2009) How Crisis Started The overall immediate cause of the financial crisis was the bursting of housing bubble in US wherein subprime mortgage holders started to default on their repayments. Over the period of time, US financial institutions started to lend to those borrowers who were technically not eligible to obtain the loans owing to their bad credit history and other factors. However, such borrowers also offered opportunity to earn higher returns as financial institutions attempted to profit from higher risks. Due to inflows from Russian as well as Asian financial crisis, financial institutions were left with excessive liquidity to offload in developed capital markets of US and UK. In order to utilize excess funds and banking on the lax regulations, financial institutions in US starte d to lend to borrowers with adverse credit history. This was accompanied by the boom in the construction sector of the economy also and financial institutions along with construction companies attempted to benefit from this. Housing bubble however, started to burst simultaneously at other developed markets also. Not only US suffered from the same but countries like UK also witnessed the cooling off of housing market and increasing rates of defaults on housing portfolio. Further, the crashing of the bubble created a contagion effect on other sectors of the economy also. As a result of this crisis and resulting tightening of credit by the financial institutions, other related industries such as automobiles

Christopher Columbus Essay Example | Topics and Well Written Essays - 3750 words

Christopher Columbus - Essay Example The western colonization was on its way and Europeans were keen to discover new land and to take maximum advantage of the resources they offer. His first voyage was in 1492 but he couldn’t reach America during that and his third voyage lead him to the new world in 1498. He never thought to discover America; it was India which he was searching. And neither was he the only and the earliest European explorer to find America. The people already living there are refers as Indians and the reason is that Columbus thought he reached India and that’s why he referred them as Indian. Columbus’ discovery played an important part in the growing economy and imperialism of European powers at that time, the economic competition was growing between the European countries and all of them were in search of new colonies and trade routes. So his discovery was a break through in the economic competition. Americans and Spanish celebrate Columbus Day every year in the anniversary of the great discovery by Christopher Columbus. It is believed that he was born in Republic of Genoa which is located in the Italy, 1 and married to a Portuguese woman. His father was a middle class wool weaver and he got two brothers and a sister. Due to the poor financial conditions of his family, he did not take any proper education and start working at sea. According to his writing, he first went to the sea at the age of ten. His first voyage was in a service to Rene I of Anjou; Columbus was assisting him in his quest to conquer the Kingdom of Naples. Since then he started his career and went to different voyages in different areas. Though there is no existing portrait of Columbus present in this world but still there are few on which we usually rely. Though an official portrait was drawn by Alejo Fernandez and the title of that was Virgeon de los Navengates. 2 From different writings we can get the idea that the Columbus was a red