In Economics, What is a Bailout?

The 2007-2009 global financial crisis, also known as the world financial crisis, credit crisis, and credit crisis, was renamed the financial tsunami and the Wall Street tsunami in 2008. It was a financial crisis that began to emerge on August 9, 2007. . After the early subprime housing credit crisis broke out, investors began to lose confidence in the value of mortgage securities, triggering a liquidity crisis. Even if the central banks of many countries have injected huge amounts of funds into the financial markets on many occasions, this financial crisis cannot be prevented. Until September 9, 2008, the financial crisis began to get out of control and led to the collapse of a number of fairly large financial institutions or government takeovers.

Global economic crisis

Northern Rock Bank 2007 runs

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Nassim Taleb warns strongly about banks' approach to risk and the nature of today's irresponsible financial system. In his 2006 book, The Black Swan Effect, he proposed:

"Global integration has created a fragile and tight economy, with seemingly irreversible conditions and a very stable scene. In other words, it has brought about the disastrous Black Swan Theory (meaning the impossible), and we have Never lived under the threat of a global meltdown. Financial institutions are continually consolidating into a few very large banks, and almost all of them are interconnected. Therefore, the entire financial system has expanded into a huge, interconnected The ecology of the banks that depend on and build houses will collapse once one of them collapses. The more intense consolidation between banks seems to reduce the possibility of a financial crisis, but once it happens, this crisis will become Global scale and hurt us deeply. In the past, the diversified ecosystem was composed of many small banks, each with its own borrowing policy, and now all financial institutions imitate each other's policies to make the entire environment more homogeneous. "It's true that the chance of failure is reduced, but once it happens ... the results make me dare not imagine."

For government-funded home loan agencies

The mainstream economists agree that if the liquidity crisis is not resolved, a global recession will be a foregone conclusion, and many other media believe that under the best conditions, there will be a five-year economic downturn. On April 13, 2009, Kluman, an authority on economics, said in a speech that if the current practices of governments are still the same, and even the financial tsunami is nearing its end, then the worst depression in history will soon strike, because regardless of

Sources of the global economic crisis

Subprime housing credit crisis

2007 Events of the global economic crisis 2007

August 9, 2007-Liquidity crisis erupts

October 9, 2007-Dow Jones Industrial Average hits record high of 14,164 points

2008 Events of the global economic crisis in 2008

2008 Global Stock Market Disaster

Bear Stearns is taken over

The Fed takes over Fannie Mae and mortgage beauty

September 2008 Liquidity Crisis

AIG is in financial distress

Merrill Lynch acquired by Bank of America

Lehman Brothers files for bankruptcy protection

Washington Mutual declares bankruptcy and is sold to J.P. Morgan by the Fed

Wachovia's deposit business may be acquired by Citibank, but Wells Fargo is also interested in M & A

Economic Stability Emergency Act of 2008

Hypo Real Estate accepts German government guarantee

Iceland is on the verge of bankruptcy and three major banks are taken over

The U.S. announced that the first half of the $ 700 billion rescue plan for the 290 billion bailout financial industry was not ideal. The subsequent change to bailout consumers was tantamount to declaring that the economic recession has changed from a short-term storm to a long-term resistance

President Bush announces $ 13.4 billion emergency bailout for GM, Ford and Chrysler

2009 Events of the global economic crisis in 2009

On the eve of the Spring Festival, the Taiwan government issued a coupon for revitalizing the economy at NT $ 3,600 per person. And before the end of the year, if you purchase a car below 2000cc and a locomotive below 150cc, you can reduce the tax on goods by NT $ 30,000 and NT $ 4,000 each.

Chinese appliances go to the countryside and cars go to the countryside.

Spain s unemployment rate rose to a record high of 13.3% in January.

The sharp appreciation of the Japanese currency has affected the total financial losses of major Japanese auto and electronics companies in excess of 2.6 trillion yen.

The pound has fallen sharply.

The US unemployment rate rose to 7.4% in January.

Both Germany's Qimonda and Canada's Nortel Networks have filed for bankruptcy protection.

U.S. President Barack Obama signed and approved a US $ 787 billion economic revitalization plan on February 18, which will take effect today. It will revitalize the economy by reducing taxes, expanding public construction and social welfare, and subsidizing local governments. Create 3.5 million jobs.

The Korean won depreciated sharply, and the Taiwan dollar devalued the 35 yuan barrier, but then rose sharply to 33 yuan.

On March 2nd, the US Treasury and the Federal Reserve Board provided another 30 billion US dollars in financial assistance to American International Group.

American Chrysler Automobile announced on April 30 that it filed for bankruptcy protection. Italian Fiat Automobile will merge and reorganize Chrysler.

British unemployment rate climbed to 7.3% in May, with 2.27 million unemployed, the highest in 12 years.

The US unemployment rate rose to 9.4% in May, hitting a 26-year high.

The Taiwan's Executive Yuan's Accounting Office announced that the unemployment rate in May rose to 5.82%, and the number of unemployed was 633,000, a record high.

American General Motors announced to the Manhattan District Court on June 1 that it filed for bankruptcy protection and organized a reorganization. It was taken over by the US and Canadian governments and announced that it would lay off another 10,000 employees.

German department store retail and tourism giant Arcandor Group petitioned the court for bankruptcy protection in June, which will cause more than 43,000 people to lose their jobs.