Australia and Gfc

In order to fully understand the role ask by Australian financial institutions in preventing further events much(prenominal) as those witnessed in the US in middle 2007, where cases of incorrupt opine in the financial banking system led to the greatest frugal downturn since the great depression of the 1930s (REF), we moldiness frontmost examine the causes of the spheric financial crisis to understand how and why it occurred and what measures stinker be taken to prevent a absorb of such a global catastrophe. In the lead up to the global financial crisis (GFC) the US had welcomed a flowing of farsighted bourne economic result lasting almost 25 age precedent to the financial meltdown occurring in mid 2007(ref #1). catastrophic failures began to happen as financial institutions previously considered as fountainhead big to fail began to collapse due to a command in liquidity (REF). Although the collapse of major financial institutions in the US and later throug hout the world appe ard to have happened very rapidly and seemingly without significant warning, we can now break away way the business practices in the stream leading up to the GFC that are responsible for such a failure. The US admit securities industry went through a period of keep harvest-time from 1963-2007 where the expense of an average house grew from USD$19000 to USD$313600 respectively (REF #2).

In the ecstasy prior to the collapse of housing wrongs in 2007, the average price of a house grew 174% to the pre GFC height of USD$313600 in early 2007 (REF #2). save during this period Americas GDP growth was decrease with an spy average gro! wth rate over the period 1998-2007 of 3%, falling from 4.4% in 1998, to 1.9% in 2007 (REF 1). The US economic growth was slowing how perpetually prices in housing where maturement at a rate which had never before been observed, the mark to the continued growth in housing prices was due to the ever change magnitude demand of new housing, this was fuelled by the availability of easy deferred payment to lenders who required a mortgage, however the standards...If you emergency to get a full essay, order it on our website: OrderCustomPaper.com

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