Global Financial Crisis Essay

The current orbiculate pecuniary crisis which became conspicuously visible during September of 2008 is considered by closely economists and world leadership the scourge kind since the Great Depression. It is equated with the failure in conservatorship of the many financial institutions ground in the fall(a) in States of America. The US is considered the closely powerful and the wealthiest nation or unpolished in the whole world that each(prenominal)(prenominal) lurch that occurs pot affect the current status of assorted countries.The failures committed by the US financial firms have evolved into global crisis affecting the financial stability of different continents like Europe and Asia. In Europe, bank failures and decline in several(a) stock indexes argon experienced. Also a large reduction in market values of equities and commodities in the world market occurred. Around the world, the fall in States of America is very authoritative and is the most prominent sphe re in the world. One proof of this is the currently finished chairwomanial election of 2008. separately and every nation in the world had their bets on who is going to learn advantage between the two stomachdidates running for office. The whole world is non taking their eyes of on who testament win between thaumaturgy McCain, a white candidate and Barrack Obama, a black candidate. non only the develop up of the US ar excited in the influent matters alone every soul, mostly world leaders, are anticipating on the victory of the republican and the one who is craving for change.McCain is the professorshipial candidate that every person sees as slightlyone who will continue the panache current president George Bush rules the country while Obama, the some other presidential candidate who claims of delivery change in the delegacy the US should be g all overned. Every union supporting both presidential candidates be go fars very vocal on who to dedicate into office. precisely, the end of every fight causes and the black community and the rest of the linked States have spoken putting someone who is craving for change in the position making Obama the archetypal black president of the most important nation worldwide.Obama attaining victory has inspired a lot of people, making it assert adapted for every person to gain what they mostly wanted and in this moment, change is still possible or change can still be perceived. What is the connection between the current global financial crisis which is considered the major crisis by and by Great Depression and the fair(a) finished presidential elections? Well, the effect of every step that the country is taking affects other countries situation. On how the new president will govern the country and how he will offer second to other countries is what every nation is expecting from the most prominent nation in the world.While, the current global financial crisis have started in the failure of the Unit ed States which is now affecting the whole world is also very influential but in a very negative way for some other countries. Global financial crisis is mostly equated, or can be treated as frugal crisis because the causes and the effects of the said crisis are principally economic and mostly on the financial stability and the economic call down of the country. Economic and financial stabilities can be the changes in prices of commodities, bank failures or unemployment.Some of the causes which lead to the global financial crisis are the following (1) mellow commodity prices, (2) trade, (3) inflation, (4) unemployment, (5) return of volatility, and (6) economic governance. High commodity prices can be mostly seen in the purchase of food and crude. Food is very first in the list because it is the main need of every person. The family should have nice food to eat every day to maintain the health of every person. Food is the number one need of every person in order to live.Oil f ollows food in the list since it is the most exported and merchandise commodity in the world since most nations are non fitting of producing oil while other nations are experiencing a surplus of oil. But the price of oil in the world market have reached $147 which lead to the increase of oil prices in every country importing oil and the originate in other prime commodities has followed. Inflation is also lay out cod to excess property supply around the world, speculation in commodities, agricultural failure, rise in the cost of imports and the rise in the charter for food and commodities. Unemployment is also considered one of the causes.The number of graduates or those people feel for jobs is growing largely each year while the number of jobs usable does not increase as fast as the number of loose people. It can be perceived that in the coming year, there will be 20 million people losing their jobs due to the financial crisis. These people who will lose jobs are mostly from the construction, real estate, financial run and auto sectors and industry. Economic governance is also important since it dictates how the providence of the country should be managed not only in time when the economy is unchangeable but also when economic instability becomes unstoppable.How world leaders and economic advisors handle the situation is very important particularly in the US because whatever decision they make will not only be perceived by the nation but also of different and other nations around the world that are mostly dependent on the US economic state. The global financial crisis can military issue to recession, rise in unemployment rate and liquidity crisis. Just after the 2008 US presidential election, leaders of the United States admitted that the country is in recession. This means that the economy is not constant as well as the financial capability of the country.This is the worst that can happen to the most influential country in the world since mo st of the countries in the world are depending on the economic changes that will be happening in the US for economic changes in their countries to also occur. other worst effect that can be judge if the crisis will not be stopped is the rise in the unemployment rate all over the world. Major companies will be experiencing problems in their balance sheets that may result to the company closing down or laying off a number of workers. The global financial crisis may result in the economy retardent down and jobs will surely be affected.In what way? Investors might be experiencing emotions in the presence of paper based losings and there will be a visible decline in wealth. The state of the investment can experience a bad state that will choose to either close down or be taken over y competitors. Major companies can also result in selling their shares of stock because of the liquidity crisis. In this moment, banks will not be willing to lend money to other banks to protect the money a nd assets that their investors and depositors have trusted them. It will be a big insecurity for banks to lend money to other banks since some banks are already experiencing bankruptcy. other thing is that importing and exportation products from other countries will be costly that the exportation and importation rates can be slowed down. In the exporting country, the commodity prices will be experiencing a decline. The exportation process slowing down, there will be lower prices for goods and services. The presence of the major global financial crisis has forced policymakers to focus on the problem well and come up with reforms that will phone the problem encountered due to the crisis. Some policymakers had come up with reforming the global financial system in order to shroud the problem.World leaders and economic advisors have already conducted meetings regarding the global financial crisis chew uping about possible steps to address the problem itself and the problems that roo t to from the major crisis. The global financial crisis may have dangerous consequences in the main to the urban and rural poor, the labor sector and women and other marginalized sector of the society. These sectors are the most vulnerable to the changes that will be brought by the crisis so the country moldiness first focus on these sectors. Policies focusing and protecting these sectors essential be employ to avoid involuntary hunger and unemployment rate.Since these are expected to be the most affected by the crisis, the state should be able to implement policies regarding social protection of these sectors. Companies who are mostly managing and holding these sectors must consider the state of the workers before deciding to lay-off workers. The most possible way is to offer lower salary for the workers if some of them will not barrack to being re fall upond from the job. The lower the salary, the greater the possibility for the owners to pay all the workers and there will be no problems regarding formation of unions because of the removal of employees.The companies clean need to talk it over to their employees before making a move because the laborers will be the most affected sector. Investors and depositors are starting to publish money on their own than putting them on the banks since there are a number of banks experiencing difficulties in maintaining their balance sheets which can result to bankruptcy. more or less of these investors and depositors are afraid to trust the banks to take care of their money due to the fact that when the crisis ill become bigger, they will have no money to spend on their basic needs.In this way, the state can talk to the central bank in lending money to banks that need most of the supplies of money to adhere to the customers needs and wants. Investors and depositors still have the rights to their investments. The state should also allocate budget for basic services. Long term plans are not possible at this very mom ent of crisis since as time passes by the number of people who might be experiencing difficulties due to the crisis is rising. The state should not focus on what can be done for the future but focus more on what can be done today to address the current issues brought about by the global financial crisis. short goals are more cognizant right now since there is a need for a quick recovery for other people especially the ones belonging to the lower-income groups, they are the most affected anyway. Overseas workers have been quit because some companies are securing jobs for their own country men. Overseas workers should not just be removed from their work even though they are not from the country they should be given the same right as every worker in the country has.Protection of these workers should also be implemented since most of them are taking jobs that the citizens of the country cannot take to get as jobs since most of them see the jobs very low. The global financial crisis m ight bring something unexpected to the country. As some economists have already perceived the rise in unemployment rate, liquidity crisis and recession might occur. Some may arrange that this is uncontrollable yet certain measures must be taken to address the problem at the present. Short time goals are the most advised at this moment. s