POLITICAL ECONOMY OF GLOBAL BANKING CRISES MUSTAFA AKAYDIN HALİL BÜLBÜL
POLITICAL ECONOMY OF GLOBAL BANKING CRISES MUSTAFA AKAYDIN HALİL BÜLBÜL.
Jan 02, 2016
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POLITICAL ECONOMY OF GLOBAL BANKING CRISES
MUSTAFA AKAYDINHALİL BÜLBÜL
REASONS OF GLOBAL BANKING CRISIS
• United States housing bubble.• Higher interest rates in adjustable rate
mortgages.• Increase in loan incentives.• Easy credit conditions.• Sub-prime lending.• Predatory lending.• Deregulation.• Over-leveraging.
US Current Account on Trade Deficit
REASONS OF GLOBAL BANKING CRISIS
• United States housing bubble.• Higher interest rates in adjustable rate
mortgages.• Increase in loan incentives.• Easy credit conditions.• Sub-prime lending.• Predatory lending.• Deregulation.• Over-leveraging.
US Subprime Lending Expanded Significantly 2004-2006
REASONS OF GLOBAL BANKING CRISIS
• United States housing bubble.• Higher interest rates in adjustable rate
mortgages.• Increase in loan incentives.• Easy credit conditions.• Sub-prime lending.• Predatory lending.• Deregulation.• Over-leveraging.
Leverage Ratios for Major Investment Banks
COMPARING THE RECENT CRISIS TO THE PAST
• 2008-2009 banking crisis far exceeds from past crises.
• Current banking crisis is much larger than the Great Depression in scale.
• More bank branches in 2008-2009 banking crisis than Great Depression.
COMPARING THE RECENT CRISIS TO THE GREAT DEPRESSION
U.S. Bank Failures, 1970-2009
U.S. Bank Failures, 1930-2009
Assets of Failed Banks and GDP
Assets of Failed Banks and GDP
Assets of Failed Banks and GDP
EFFECTS OF GLOBAL BANKING CRISIS
• Impact in the USA• Unemployment• Poverty• Prices• Private and Public Transfers• Assets and Goods and Services• Effects on Developing Countries
Impact in the USA
Impact in the USA
EFFECTS OF GLOBAL BANKING CRISIS
• Impact in the USA• Unemployment• Poverty• Prices• Private and Public Transfers• Assets and Goods and Services• Effects on Developing Countries
World map of countries by rate of unemployment
EFFECTS OF GLOBAL BANKING CRISIS
• Impact in the USA • Unemployment• Poverty• Prices• Private and Public Transfers• Assets and Goods and Services• Effects on Developing Countries
Impact of global financial crisis on poverty
EFFECTS OF GLOBAL BANKING CRISIS
• Impact in the USA • Unemployment• Poverty• Prices• Private and Public Transfers• Assets and Goods and Services• Effects on Developing Countries
Effects on Developing Countries
SOLUTIONS OF GLOBAL BANKING CRISIS
• Deposit Insurance• Bank Support• Prompt Closure and Payout
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