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Archive for the ‘Global crisis’ Category

The Global Monitoring Report 2010 seeks to assess the impact of the global economic crisis on poverty. Useful phone? According to World Bank analysis of the global economic crisis had a negative impact on poverty, but could be much worse. The report argues that the policy of timely and efficient manner, including support from international financial institutions that helped save the day.

What are the effects of the crisis?
The report says that while it is too early to “Instant-high” are the various MDG indicators. So what do the employees of the Bank is doing to assess the economic impact of the use of modeling. Bank staff to the impact of the crisis on poverty in the simulation to estimate poverty for post-crisis scenarios before the crisis. For example, the model estimates that are out of the crisis, poverty in the world and to 918 in 2015, with the crisis, the number 865, then the implications 53m.

The same calculation can be divided by region and the results are shown above. It should be noted that the impact on poverty is concentrated in Africa and South Asia. The impact of India is also characterized, at least not because India is widespread and has withstood the global crisis. One possible explanation is that India has a large number of poor people (456 in 2005), so that even small changes in GDP can have a significant impact on the number of people who also have poverty. Bank staff have an excellent job in analyzing the impact of the global economic crisis on poverty and well worth the Global Monitoring Report 2010 reviewed the reading. Critics complain about the methodology of the Bank, but we have not seen better estimates. And with a major UN summit in September to discuss the Millennium Development Goals, the bank’s analysis is not intended to fill an important gap. This is our assessment that, although estimates are crude, they are the best and now have a useful reference point for political debate.

International financial crisis, caused by excess liquidity and inadequate regulation of a highly integrated system of international finance, has made the world economy on the brink of recession. In addition, unilateral actions that various government adopted in the beginning indicate the difficulty of coordination in a multi-polar economic world without clear leadership. Fortunately, the rescue package has been approved, and under the leadership of England, appears to have formed a consensus about the need to recapitalize the banking system and guarantee deposits and interbank loans. This will not prevent a recession, but can not be used for deep and lasting. In the sense that, the lessons from previous crises have led the authorities to react with a certain speed. However, significant challenges on how to build a shared leadership in order to provide for better regulation of financial globalization.

This crisis will have major geopolitical implications, which are still difficult to anticipate. First, the crisis will be a turning point in economic globalization and liberalization would end the period commencing on the 80′s with the hands of Ronald Reagan and Margaret Thatcher. Although the crisis would not cause the collapse of capitalism, the state will recover the legitimacy and power relative to the market and Anglo-Saxon liberal model lost some charm and influence, especially for the European-inspired model with more regulation and public intervention. Second, the crisis will accelerate the relative decline of the U.S. and the emergence of forces that emerged in the world economy (which in their SWFs acquire various assets in rich countries), may anticipate and create a more radical reform of global institutions of governance. Read the rest of this entry »

The global financial crisis is the result of financial liberalization in the last 20 years, not accompanied by new rules correctly and that excessive global liquidity, which is produced mainly by the United States. financial euphoria sparked a distorted perception of risk, causing excessive leverage, combined with household and corporate debt and limited regulation of non-traditional banking sector, causing the bubble, both real estate and other assets. The outbreak of the U.S. housing bubble and financial globalization accelerated the crisis quickly spread throughout the world.

Although this is the biggest crisis since the fall of 29, the two are very different. At that time the world economy experiencing deflation and the unemployment rate exceeds 20% in a time when Americans did not have the reach of social networks such as that currently used. In addition, there is no developing country (so peripheral) capable of providing growth and the central fund. Therefore, although in future years will increase unemployment and inflation will come down most likely that the global economy could escape from the depression like the 30s. And the reason is that a lot has been learned from the crisis, especially in the technical aspect. Issues still waiting for political leadership. Read the rest of this entry »

Economic crisis experienced by the United States the cause of the global economic crisis. General description of the cause of the global crisis is a process securitasi sub-prime mortgage crisis that occurred in America.

Indicators of global financial market turmoil. That mortgage borrowers fail to pay or housing credit or unable to fulfill its obligation to cause the crisis of investor confidence, this resulted in tight financial markets, while financial markets with cash and quickly spread throughout the global financial markets.

Credit losses are soaring due to the operation and closure insolvabilitas several giant financial companies like Lehman Brothers, AIG, and others might lead to a transfer of risk and tightening global liquidity.

With the economic crisis faced by the developed countries so they took out several policies such as lowering interest rates, adding to supply dollar liquidity in this case the interbank money market, lowering reserve requirements or compulsory savings at the central bank of each country, raising the deposit guarantee limit customers, and the financial system rescue plan to inject capital such as that conducted by the UK and also the United States. Read the rest of this entry »

Cause of the failure of a bank crisis, Indonesian national banks, has provided experience for us all that if there is a failure of a bank in the end be a burden the State. It has been proven when the banking crisis in the year yesterday. Recapitalization through the issuance of bonds by the end of extending the state budget expenses. Therefore fair to say that the failure of a bank eventually become a burden on society.

Realistic risk of bank failures should be measured and rational. This means that from start to realize that the possibility of bank failures to be reckoned with no matter how unlikely. Thus it can be done in order to provide a reserve source of handling failed banks become more organized and accountable. Read the rest of this entry »

Ms. Sri Mulyani, Heroes global crisis of Indonesia, is now struggling to prove himself that he was never guilty in the case of Century Bank.

Results of investigations Audit Agency (BPK) on Century Bank’s case is not entirely true, as my little heart sure. As a small people I just hope that the economic wheels keep running smoothly. Problem support support, I could not do much. I can only concerned with listening and hold information from various media. To the concern that because of course there Kartini in this economy come dragged into the political maelstrom palace. If the policy of Finance Minister is not proven wrong, the consequences will be dramatic: we could lose the finance minister who is our pride.

Results Audit Agency inspection of a minister, Sri Mulyani, whose reputation was so great. Both internationally and in the control of state finances. Internationally he was selected as the best finance minister in the world two years in a row. Domestically he is known as the first minister who dared to reform the bureaucracy in his department. Ministers also very strict control over the state budget.

In fact, she was the only minister who dared to ask to stop when there are signs the government will defend a conglomerate that he considers should not be defended. Read the rest of this entry »

The financial crisis arrived in Spain almost two years after the rest of the world. The weakest link-the-savings can no longer hide more red tape. Meanwhile, banks reportedly saved 2010 in benefits, although less than in 2009.
The concealment of the outstanding claims of the developers and builders can not last indefinitely. While the ECB has expressed Thursday his intention to maintain the liquidity measures until at least October, the Spanish financial system is prepared for national crisis, which comes nearly two years after the bankruptcy of Lehman Brothers in USA, milestone marked the beginning of the storm “subprime”.

The 445,000 million which have been granted and savings banks in the form of credits for real estate activities “are a serious threat to the stability of the system. Not all of these loans will be outstanding, but the market believes that at least a quarter of the funds will not be returned.

So far the strategy of the entities was clear: all possible credit refinance (roll over) and borrow from the ECB at an interest rate of 1%, putting public debt as collateral acquired from the States, whose return was more than triple that offered by the central bank.

But it has come a time when the weakest link is breaking. 70% of the business of savings banks has been based on the brick and its quarterly accounts already show a clear deterioration, with half of the entities in the red. Read the rest of this entry »