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Rajan’s analysis of the roots of the 2008 financial crisis focuses on three fundamental stresses: widening income inequality in the US, trade imbalances in the global economy arising out of historical trajectories followed by late-developing countries, and the clash between arm’s length financial systems, as present in the US and Britain, and relationship-based financial systems, as ...
A currency crisis, also called a devaluation crisis, [7] is normally considered as part of a financial crisis. Kaminsky et al. (1998), for instance, define currency crises as occurring when a weighted average of monthly percentage depreciations in the exchange rate and monthly percentage declines in exchange reserves exceeds its mean by more ...
Among the factors contributing to the surge of inflation were the unprecedented levels of fiscal and monetary stimulus enacted to sustain household incomes and the liquidity of financial institutions in the 2020–2021 period. Many governments around the world adopted such stimulatory actions early in the COVID-19 pandemic. [34] [35] [36] [37]
The hidden risks have created what the bank views as an increasingly tenuous situation beneath the surface.
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Recessions. Many factors directly and indirectly serve as the causes of the Great Recession that started in 2008 with the US subprime mortgage crisis.The major causes of the initial subprime mortgage crisis and the following recession include lax lending standards contributing to the real-estate bubbles that have since burst; U.S. government housing policies; and limited regulation of non ...
Inflation can arise from a multitude of factors, such as increased consumer spending, rising labor costs or energy prices, supply chain disruptions and monetary and fiscal policies.
[110] [111] [112] Many factors have contributed to the ongoing world food crisis. These include supply chain disruptions due to the COVID-19 pandemic , the 2021–2023 global energy crisis , the Russian invasion of Ukraine , and floods and heatwaves during 2021 (which destroyed key American and European crops). [ 113 ]