Question

Hi i am doing an assignment on the financial crisis. I am up to the conclusion and i am having trouble writing it can you please write up a summary of the financial crisis. Thanks

Answer 1

Answer:

FINANCIAL CRISIS:

Turkish Currency and Debt Crisis 2018 :

Turkish Currency and Debt Crisis 2018 occurred in Turkey.

It was basically a financial and economic crisis.

During that crisis, what happens is the currency of Turkey, Turkish Lira falls down, high inflation occurs, borrowing costs increases and increasing loans defaults.

The basic reason for this crisis was the excess of current account deficit and huge amount of private foreign currency denominated debt of Turkish economy.

Also the impractical interest rate policies of the president was also a reason.

Consequently, corporate debt defaults and economic growth shrinks.

Explanation:

financial crisis affect our finances:

When financial crisis hit the market it will affect every people and their finance as the prices of every routine things go up and we end up paying much more than normal price.

Everything priced high whether it is loan or food or car and with no increment in salary in time of financial crisis.

Interest rates go high of banks and home prices go lower than the market rate thus, every necessary item of living get high prices with limited amount of income we would hurt our budget.

what happened in market before financial crisis is:

The financial crisis started with mortgage market, banking firm started to collapse as mortgage lender started to file bankruptcy.

Higher mortgage approval rate led to many customer to have mortgage of home lending without proper credit checking and later they all defaulted on credit that lead to crisis into mortgage market which caused crisis for many large banks.

How does financial crisis occur:

Bankruptcy of many famous banks and mortgage lenders bankruptcy lead to financial crisis and they heavily invested in security backed mortgage to people who had bad credit history.

This caused real estate bubble in real estate market.

Famous Lehman brother files for bankruptcy like them many happened to be defaulters and because of their there was more crisis in banks.