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Second Great Depression

Decent Essays

Many changes have transcribed in the global market since the years of 2008-2009, the years of what could be dubbed as the “Second Great Depression”. The changes made have been of significant impact as the market has had to accommodate or regulate a great quantity of systems that range from the advancement of technological platforms in the compartment of information technology to the increase in demand of less common forms of energy being established by major corporations such as Tesla’s Powerwall home batteries. The increase of applications via phones have even made it easy for investors, even novice investors, to buy shares in stock markets at an international scale with a push of a button, taking great advantage of what the globe offers in …show more content…

Also, these systems can affect both emerging developing economies and developed, established economies. According to research made by CITATION Bab12 \l 1033 (Babecký, et al., 2012) indicators can be found on both domestic and global scales. The two of the strongest indicators that a crisis is on the move in the domestic market includes but are not limited to, the ratio of domestic private credit to GDP in which the private sector increases. Secondly, the fall on housing share prices in the stock market. On a global scale, the most useful indicator is the drop on in credit on a private sector. This research has been done with the help of statistics, the Bayesian models, to demonstrate upper and lower bound with four quartiles. With that said, CITATION Bab12 \l 1033 (Babecký, et al., 2012) sample research indicates that the domestic credit growth is the greatest indicator with staggering projections that go as far ahead as 16 quarters before the time of a crisis coming to …show more content…

The good news on the matter though is that research is ever increasing and not stagnant and the errors of the past make great assets for the future. Torres (2011) made a great deal of discoveries concerning the crisis of 2008, identifying that the trend that brought about the demise of the crash was the inefficient income inequalities that was being neglected from 1995-2007. The amount of private debt that was being accumulated was because middle class wages were not increasing at a rate that was proportionate to the loans been handed out by banks. This in effect caused the delicate economical system to disintegrate, leading weaker economies to become depressed and stagnant from the lack of demand from the depressing expenditures; a domino effect was unleashed. With this data, measures can take place to ensure that there is a balance in the CPI by putting forth great focus on structuring more jobs and increasing wages over much of the population, the middle class, so that private loans that are given can subsequently be paid off. This in turn will give room for supply and demand to continue to flow permitting upcoming enterprises and economies to continue to

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