Spain Sub Prime Crisis

7850 WordsMar 4, 201432 Pages
Name of the University Master Thesis Banking system reforms after the subprime crises Study case: Spain Author: | Supervisor: | | | Department of …………………………… January 2014 Abstract How did the Subprime Crisis, a small problem of U.S. financial markets, affect the entire global banking system? The aim of this paper is to analyze the effect of the subprime crisis on the banking sector in Europe, with a close attention on the case of Spain. Spain is currently facing the worst crisis ever experienced in its financial history, so it would be interesting to analyze what is the real situation of the banking sector and what will be the reforms that could lead to a consolidation of the financial systems. The strengths…show more content…
They have different shapes and sizes, taking different forms during time, and usually spread across borders. Financial crises are often the product of asset and credit booms that eventually turn into busts. This booms can be identify in time but no one still has an answer of why they are allowed to continue, knowing that can rapidly become unsustainable and turn into busts or crunches. The subprime crisis: origins and evolutionThe subprime crisis is an over studied topic studied by a vast number of thinkers trying to establish the cause and to find the culpable for the greatest economic collapse since great depression. Trying to point out a single cause as the root of the crisis is however impossible as our current situation is the results of a set of political, economic and social policies. A lot of literature is dedicated to the subprime crises subject, all finding guilt in the management and moral hazard existent in the American economy. It all started on the American continent and soon became viral thru all the world’s economies. The interdependence of countries created a wave effect, so all the symptoms of the crises could be seen in different time periods, in the whole world. The growths catches a faster pace with the help of financial instruments that were created to provide liquidity to the markets. So we could see the widespread securitization of mortgages pushing the credit market to develop under
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