Economic Crisis 2008 – A Study
Presenter: Madhurima Bhattacharya
National University of Singapore
Theme: Global Solutions for Economic Recovery
The world seems to be experiencing a major financial storm every once in a while and each with far-reaching effects – who can forget the Great Depression of 1929 or the Asian Financial Crisis of 1997? However there must be something about the ongoing economic and financial crisis that compelled UNCTAD to label it as the “Crisis of the Century”; probably the epicentre of the crisis being the US or financial innovations of the recent years have contributed to it.
This paper draws parallels, such as poor corporate governance or a period of economic excitement between the recent and some previously experienced crisis, and utilizes these to develop some possible solutions for the problem. Further, it analyses the current situation to single out features, ranging from moral hazards and governance, psychological biases, liquidity problems and bubbles that particularly contributed towards the crisis situation and made it more challenging to resolve. Finally some specific strategies to be implemented by the governments, financial institutions as well as general populations are suggested.
However dismal the situation, the silver lining is the opportunity for regional economies to seize this chance to strengthen their interdependence on one another’s consumer and credit market, and create a greater global presence.