Financial crisis of 2007-2008
This was the biggest crisis of recent times and what started off in Wall Street soon spread around the globe. There was hardly a market that was untouched by the crisis. Here’s what happened – failures of big financial institutions in the US, due largely to exposure of securities of packaged subprime loans and credit default swaps issued to insure these loans, quickly evolved into a global crisis. A crisis that led to failures of banks in Europe and steep declines in the value equities and commodities globally.
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Later, President George Bush signed the Emergency Economic Stabilization Act, building a Troubled Asset Relief Program (TARP) to acquire falling bank assets. All in all, the crisis had disastrous effects on the global economy and trading around the world.