whereas “if there’s a decrease in GDP growth for more than 4 consecutive quarters‚ we say the respective country is in depression”. My friends over here will be mentioning the obvious points like subprime crisis‚ bankruptcy of investment banks like AIG‚ Lehmann Brothers‚ Freddie Mac‚ faltering of mortgage loans and some other common points. I‚ on the other hand‚ will be talking about Foreign Investments in FOREX reserves and stock market. Forex reserves as you know are the reserves of foreign currency
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It is debatable that the best things in life are free‚ but there is no question that the necessities to live a life in today’s society costs money. Having a job or career is no longer an option as much as it is a requirement to live in the society that is today and to be able to afford the basic needs of an individual such as shelter‚ food‚ and clothing. Unemployment rates are on the rise and unemployment is becoming a leading issue in America after the economic recession the country has been facing
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we emphasize ’might not’ because even with undesirable credit‚ it is still quite possible to get a mortgage refinance loan - the only catch is the refinance percentage rate. If you’re trying to obtain a mortgage refinance loan at low rates and you have bad credit‚ just forget about it. Bad credit makes you different from the rest of the consumers‚ particularly
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1.) Investment Strategies: The investment strategy of the High Grade Structured Credit Strategies Master Fund was to raise capital from investors and that capital was used to buy “collateralized debt obligations” backed by highly rated subprime mortgage back securities. These CDO’s had a higher rate than that of their borrowing rate‚ thus‚ they had added to their expected return by levering more and then buying more CDO’s. To hedge some of the risk of the underlying asset‚ they bought credit default
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major crisis like the Great Depression‚ World War II‚ the 1987 market crash‚ and the 9/11 terrorists attack and never had a losing quarter in its history until December 2007‚ when Bear Stearns announced the first loss for about $854 million. 1. Failure Analysis: 1.1. Major factors that contributed to Bear Stearns failure After the 9/11 terrorist attacks‚ all the major bankers such as Lehman Brothers‚ Merrill Lynch‚ Morgan Stanley‚ and Bear Stearns wanted to capitalize on the mortgage boom
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12 Introduction I picked this book after carefully analyzing all the different titles. The reason I picked this book was because I wanted to learn more about the Financial Crisis in America as it is slightly out of my comfort zone. I had no previous knowledge of how Goldman Sachs operated or how influential they were in America. Money and Power was described as an insight into the inner circles of Goldman Sachs revealing a
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Role of Finance Companies Traditional role of Finance Companies The finance companies are much smaller in scale compared with commercial banks‚ and they are also saddled with more restrictions which will be discussed later in the report. Traditionally‚ they relied on their personalized and flexible services to attract clients. This is because there are always consumers who are rejected by the commercial banks because adding these consumers to their portfolios would be uneconomical for these commercial
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Economy...................................................... 1.2 Impact on Interest Rates...................................................... 1.3 Impact on Banking Sector.................................................... 1.4 Impact on Mortgages and Credit Lending Agencies............ 1.5 Impact on GDP..................................................................... 1.6 Impact on Inflation................................................................ 1.7 Impact on Employment
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“It takes many good deeds to build a good reputation‚ and only one bad one to lose it.” (Ben Franklin). Goldman Sachs was the most prestigious investment bank with over one hundred years of good business history and on September 21st‚ 2008 it reorganized itself as a bank holding company. As a bank holding company‚ it engaged in global investment management‚ investment banking‚ securities‚ and other financial services. An unfortunate series of scandals had put its good reputation in a downward
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and investment and asset management. Refer Annexure 2 for the business overview. Until the 2007‚ Lehman generated a significant portion of its revenue through the issuance of mortgage-backed and asset-backed securities. When the collapse of the U.S. subprime mortgage industry started resulting credit crisis & the mortgage default rates began to rise and the demand for these securities began to disappear‚ Lehman was left with billions of dollars of rapidly depreciating securities on its balance
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