What is the economic crisis?

The economic crisis is a state in which dramatic shifts in the economy create serious problems for all associated with this economy. While this term is sometimes used to indicate shifts in the personal wealth of individuals or even the movement and collapse of society, the real economic crisis is usually associated with serious changes in the national or even world economy. Events such as the great depression, which began in 1929 with a stock market crash, can be correctly referred to as an economic crisis.

There are several characteristics common to any type of economic crisis. One has to do with the rise in unemployment rate. This is often caused by a chain of economic events that employers force them to either stop or turn off the operations. The ultimate result is that more people are out of work, which in turn affects the sale of goods and services and leads to further redundancies because companies cannot generate income necessary to maintain and pay their employmentto. During the economic crisis, banks may fail, companies are moving below, and home owners face a greater threat to the market closure due to non -mortgage.

During the economic crisis, stock markets and other forms of investment markets, they are likely to see a serious decline. As companies start to fail, the value of their shares is also decreasing and trading is beginning to decrease, because investors cannot interpret their shares at any price, even for a serious loss of the original investment. It is not unusual that the currency that goes through this type of crisis, which is to be devalued, which in turn serves only to prevent the chances of the economic recovery. Usually there is no type of economic activity that is not adversely affected during the real crisis.

Economic crisis can take many forms, including a period of recession or depression, which also include more problems such as financial ruptureBubbles in key industries, monetary crisis or even a banking crisis that are threatened by undermining a banking system in one or more countries. Although there are many examples of national and even worldwide events of this nature, there are still a number of different theories in terms of how to predict, manage and eventually overcome the economic crisis. For this reason, there is no uniform approach preferred by analysts, although there are often basic principles that many will feel, can be used as soon as the crisis actually takes place.