Australia and Gfc

In order to fully understand the role screw by Australian financial institutions in preventing further events much(prenominal) as those witnessed in the US in middle 2007, where cases of incorrupt mishap in the financial banking system led to the greatest frugalal downturn since the great depression of the 1930s (REF), we moldiness starting examine the causes of the orbicular financial crisis to understand how and why it occurred and what measures sens be taken to prevent a absorb of such(prenominal) a global catastrophe. In the lead up to the global financial crisis (GFC) the US had welcomed a flowing of farsighted status economic result lasting almost 25 days precedent to the financial meltdown occurring in mid 2007(ref #1). catastrophic failures began to happen as financial institutions previously considered as rise big to fail began to collapse due to a knock off in liquidity (REF). Although the collapse of major financial institutions in the US and la ter throughout the world appe ard to have happened very rapidly and seemingly without significant warning, we can now open way the business practices in the gunpoint leading up to the GFC that are responsible for such a failure. The US hold securities industry went through a period of keep development from 1963-2007 where the expense of an average house grew from USD$19000 to USD$313600 respectively (REF #2).

In the ex prior to the collapse of housing sets in 2007, the average price of a house grew 174% to the pre GFC height of USD$313600 in early 2007 (REF #2). save during this period Americas GDP grow th was fall with an spy average growth rat! e over the period 1998-2007 of 3%, falling from 4.4% in 1998, to 1.9% in 2007 (REF 1). The US economic growth was slowing how constantly prices in housing where maturement at a rate which had never before been observed, the key out to the continued growth in housing prices was due to the ever change magnitude demand of new housing, this was fuelled by the availableness of easy deferred payment to lenders who required a mortgage, however the standards...If you essential to get a full essay, order it on our website: OrderCustomPaper.com

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