POLS 1500 Lecture Notes - Lecture 7: Interbank, Nationalization, Chapter 11, Title 11, United States Code
22 Aug 2016
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Document Summary
Pols 1500 the global financial crisis and its effects. The u. s. & global economy are in serious crisis. Current global recession is the worst economic downturn since the great depression. Dow jones plunged more than 50% from 14,000 in late. The big credit crunch a crisis in the money market. Interbank lending the center part of the money market. From september "07 onwards, banks restricted interbank lending (sharp rise of interbank interest. There is no liquidity crisis banks are not lacking liquidity but hoarding it. Institutional investors rush to state papers (and commodity exchange) There is an insolvency crisis hidden bankruptcies because of the losses still undisclosed. Since october "07, central banks have stepped in several times. Us corporations holding 1. 5 trillion in reserves. Corporations not investing due to uncertainty in the global economy. Lack of investment leads to lack of jobs, lack of demand and lack of investment. The first banks fall the case of northern rock.
