2007-2009 Financial Crisis Essay Example | Topics and Well Written Essays - 250 words

2007-2009 Financial Crisis - Essay Example As many companies have struggled to cope with this crisis, large numbers of people have been deprived of their jobs. It is seen that hundreds of people working in different fields lost their works during the crisis, and it resulted in poor economic growth. Shi and Singh (2011) pointed out that, â€Å"During the 2007-2009 recession, the unemployment rate in the United States topped 10 %, the highest it had been in the 26 years† (p. 545). So, the crisis has made unemployment worse for many people as it has become more difficult to find a new job. To be specific, many companies have been reluctant to hire any new people. The financial crisis caused to decline in international trade, and finally led the nation towards unemployment. At the same time, the financial crisis was worldwide, with European banks and markets as severely affected as those in the United States. The crisis checked the growth of total economies, and international trade declined and collapsed. Kaar (2009) made it clear that, â€Å"As at the present time the world can be regarded as a closed economy with highly integrated global markets, the unanimity in pessimism, the widespread fall in consumer confidence and the new credit restrictions soon had devastating effects on numerous countries real economies and forced thousands of healthy businesses around the globe and across all industries into financial troubles† (p. 27). So, one can see that the economic crisis resulted in global stagnation. Besides, the crisis affected the smooth functioning of the banking system in the U.S. It questioned the stability of many banks. For in stance, financial institutions like New Century Financial and Ameriquest faced insolvency. MacEwan and Miller(2011) stated that, â€Å"On September 15, Legman Brothers, in existence since 1850, declared bankruptcy† (p. 110). In short, most of the financial institutions were forced to undergo crisis and suffered trillions of dollars in losses. Summing