How Global Economic Environment Is Affecting International Marketers?

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How Global Economic Environment is affecting International Marketers? --------By Md. Jafar Sadique, MBA, Southeast University Bangladesh

1. Introduction:

International business is taking different shades and is unavoidable today. This dynamic world is rapidly changing to the extent that is has been reduced to a "Global village".

The truth is, we are going through the most severe global financial crisis since the days of Great Depression. Originated in USA, economic recession is affecting all the major players of world economy. Governments and major policy makers of world economy have taken notice of the urgency of the situation and
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Over the years, many banks in the US started the practice of offering home loans to high risk individuals, i.e., individuals who had a high probability of defaulting on their loans. The banks justified this move by saying that even if these individuals defaulted on their loans, the amount could be recovered by selling off the property in question.
Over a period of time, many of these individuals defaulted on their payments, as was expected, and the banks put the properties back on the market. However, when so many properties were put on sale at the same time, the property prices, which were already over inflated to begin with, plummeted. The unprecedented drop in property rates proved fatal for banks that had already invested most of their money in these speculative deals, and they were forced to close down.
The collapse of these banks is just one of the indicative causes of the present recession. The roots of this recession can be said to lie in over-inflated property prices, oil prices, and commodity prices. Artificially inflated prices are typical of a profitable market. When the market is doing well, the sellers eventually become greedy and raise the prices. All is well, as long as the buyers continue to be able to afford the inflated prices. However, the day the prices reach a level where the majority of the buyers cannot afford them, a crash in the prices, and consequently a recession, is inevitable.

3. Present Global Economic Environment:
The year 2008

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