7/17/2019 Reaction Paper

http://slidepdf.com/reader/full/reaction-paper-568f4af70b1eb 1/1

Rosete, Herrika Red Gullon

Finance33A (00680)

Prof. Rebecca Mauilin!

"#e Financial $risis of %00&'%008

urin! t#e Global Financial $risis, econoies *orld*ide slo*ed do*n, as

credit ti!#tened and international trade declined. + a surrised t#at t#is is t#e *orst

financial crisis since t#e Great eression of t#e -30s, accordin! to t#e

econoists. + did not feel t#is since + *as onl/ -- /ears old t#at tie. ut no*, + a

older, + can alread/ feel its iact to t#e econo/ of not onl/ of 1nited 2tates, but

also of our countr/. efore, + #ae e4erienced lo* inflation rates. "#e rice of 

coodities before is lo*er t#at toda/. "#is eans inflation rate increased /earl/. +

#ae learned t#at an/ countries deend on t#e econo/ of 1.2. As 125s econo/

suffers, an/ countries of t#e *orld *ill also be affected. +t t#reatened t#e collase

of lar!e financial institutions, *#ic# *as reented b/ t#e bailout of bank b/ national

!oernents, but stock arkets still droed *orld*ide. + a bot#ered because t#e

#ousin! arket suffered *#ic# resulted in eictions, foreclosures, and rolon!ed

unelo/ent. #en unelo/ent rises, an/ eole *ould #ae no 7obs, *#ic#

*ould result to #i!# crie inde4. "#e crisis also la/ed a si!nificant role in t#e failure

in consuer *ealt# estiated in trillions of 1.2. dollars, and a turndo*n in econoic

actiit/. "o oercoe t#is kind of crisis, t#e !oernent s#ould iroe its onetar/

olicies. ike in t#e 1.2., t#eir $on!ress assed t#e Aerican Recoer/ and

Reinestent Act of %00.