15 Sept *Insurer American International Group Inc. seeks $40 billion in short-term financing from the Federal Reserve. *Lehman Brothers Holdings Inc. said it plans to file for bankruptcy protection. The bankruptcy represents the end of a 158-year old company that survived world wars and the collapse of long-term capital management but could not survive the global credit crunch. *Bank of America agreed to buy investment bank Merrill Lynch for $50 billion in a transaction that creates the world’s
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There are a vast array of similarities and differences when comparing and contrasting the Berlin Blockade and the Cuban Missile Crisis. The United States had been trying to make Germany a democracy since the end of World War II‚ but had faced much opposition from the Soviet Union‚ which wanted to make Germany communist. The United States and Germany ended up splitting the country and capitol city‚ Berlin‚ in half; half communist and half democratic. In Berlin City the people just kept moving from
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Subprime Mortgage Crisis ECO561 January 19‚ 2015 Subprime Mortgage Crisis Subprime mortgages are generally granted to borrowers who cannot obtain conventional mortgages due to insufficient or delinquent credit histories. These borrowers may be forced to take interest-only loan‚ which have lower monthly payment but are very difficult to pay off in the end. Problems with mortgage financing are the generally accepted cause of the financial meltdown that occurred between 2007 and 2008 (Gorton‚ 2009)
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The impact of the global financial crisis on the Philippine financial system – an assessment “The problem in politics is this: you don’t get any credit for disasters averted.” Henry M Paulson Jr‚ Former US Treasury Secretary I. Introduction The crisis that originated from the US subprime mortgage market escalated into a global phenomenon. Earlier debates on “decoupling”2 died down as the crisis’ contagion effects proved headstrong‚ cascading to the financial markets of advanced
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Safe as houses by André Evju Starting by quoting Warren Buffet: “Derivatives are the financial answer to weapons of mass destruction”. So how exactly was this fragile system build up? Since the beginning of the 1980s‚ the US experienced a continuously deregulation of it’s financial markets‚ allowing financial institutions develop complex financial instruments to gain enormous profits. In the late 1990s‚ there was a consolidation of financial institutions in the US‚ contrary to previous legislation
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The Cuban Missile Crisis: Soviet Diplomacy and United States Aggression The Cuban missile crisis brings to mind visions of a great triumph over the Soviet Union and the defusing of an all-out nuclear war. However‚ this "crisis" was not so much the product of true Soviet advances towards war as much as it was a series of misinterpretations and miscommunications between the United States and Soviet governments that culminated in excessive aggression by the U.S. and unnecessary escalation of tensions
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13 days;How did President Kennedy Bring The Cuban Missile Crisis To A Peaceful Conclusion? On October 1962‚ the world waited 13 days on the brink of nuclear war and hoped for a peaceful resolution to the Cuban missile crisis. In October‚ an American U2 plane flew over Cuba and secretly photographed nuclear missiles made by the soviet union. President Kennedy was shocked and started right away to secretly meet with his advisors to discuss this big problem. He didn’t want the soviet union or cuba
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The Causes and Consequences of Financial Crisis in 2007 – 2008: From the Historical Perspective I. INTRODUCTION In September 2008‚ the financial crisis abruptly transmitted to emerging markets. It began with the credit boom‚ steeply rising home prices and finally led to the global imbalances in foreign trade. In a short time‚ the problems in subprime market became increasingly visible and include the failure of several subprime originators. The reason why it created a shortage of U.S. dollars in
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The intention of this essay is to provide an in depth and critical analysis of the financial crisis that took place between 2007-2009‚ in particular focusing on some key issues raised by the Foote‚ Gerardi and Willen paper ‘Why did so many people make so many Ex Post bad decisions?’ Whilst there were many contributing factors‚ it is clear that a specific few played a particularly dominant role‚ primarily the ‘Bubble Theory’‚ irresponsible regulation‚ toxic CDO’s and $62 trillion of CDS’s. ‘That’s
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The 2008 Financial Crisis & how to prevent it from happening again The 2008 financial crisis originated from the USA‚ where large growth of the subprime mortgage market resulted in a housing price bubble. However‚ agency problems started arising that resulted in households to take on mortgages they could not afford. Eventually‚ the bubble burst led to rising mortgage defaults. Ultimately‚ investment banks like Lehmann Brothers and Merrill Lynch filed for bankruptcy‚ citing heavy losses
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