Anatomy of a Financial Meltdown

Capitalist Meltdown

Managing Syria s Meltdown

Europe s Scientific Meltdown

Motor City Meltdown

China Confronts the Global Meltdown

Melting Pot or Economic Meltdown

First, of course, the economic meltdown.

The Middle East Meltdown and Global Risk

After the financial crisis, the United States enacted the Dodd Frank Act to overhaul American financial regulation, with the aim of reducing the risk of another financial meltdown. But it did nothing to reform repo lending arguably the weakest link in the financial chain.

CAMBRIDGE Financial commentators have likened Japan s earthquake, tsunami, and nuclear catastrophe to derivatives role in the 2008 financial meltdown. The resemblance is clear enough each activity yields big benefits and carries a tiny but explosive risk.

Indeed, China can probably avoid the financial meltdown widely feared in the summer. If so, other emerging economies tied to perceptions about China s economic health should also stabilize.

Still, this global recession will continue for a longer period than the consensus suggest. There may be light at the end of the tunnel no depression and financial meltdown.

Perhaps the risk that a Greek debt restructuring would cause a financial meltdown was always minimal, and quiescent markets were to be expected. But, in that case, why all the fuss?

After financial implosions, such as the collapse of the dot com bubble in 2000 or the sub prime meltdown of 2007 8, such views appear arrogant. The parallel between bewildering and apparently meaningless art and unintelligible financial products is damning rather than reassuring.

LONDON Testifying recently before a United States congressional committee, former Federal Reserve Chairman Alan Greenspan said that the recent financial meltdown had shattered his intellectual structure. I am keen to understand what he meant.

LONDON Testifying recently before a United States congressional committee, former Federal Reserve Chairman Alan Greenspan said that the recent financial meltdown had shattered his intellectual structure. I am keen to understand what he meant.

The parallel launch of China s 12th Five Year Plan and Europe s 2020 Strategy has also helped to deepen our cooperation. China and Europe worked together after 2008 to prevent a global financial meltdown, oppose protectionism, and promote reform of the international financial system, thus facilitating worldwide economic recovery.

Finally, once the crisis hit, leading to a re pricing of risks in financial markets, the need to avoid an economic and financial meltdown compelled governments to support aggregate demand and make private liabilities whole. But the disconnection between centralized monetary and decentralized fiscal powers de facto impeded the full use of monetary instruments to meet monetary and financial shocks.

Sooner rather than later, other periphery countries will also need help. Greece, one hopes, will not be forced to leave the eurozone, though temporary options such as imposing capital controls may ultimately prove necessary to prevent a financial meltdown.

Equally disturbing has been the continuing reluctance of international leaders to provide new financial commitments to Ukraine, despite growing pressure on its foreign currency reserves and the specter of a full blown financial meltdown. As a result, the mere threat of military action may be sufficient to bring about Ukraine s economic collapse.

With home prices falling (and set to continue to fall), and with banks uncertain of their financial position, lenders will not lend and households will not borrow. So, while the additional liquidity injected into the financial system by the Fed may have prevented a meltdown, it won t stimulate much consumption or investment.

BRUSSELS The metaphors used during the financial crisis of 2008 2009 earthquake, tsunami, meltdown, black swan, and fallout are back with a vengeance, but now they are being recycled literally. In fact, the financial crisis and the nuclear crisis at the Fukushima nuclear power plant in Japan share at least four similarities

It is held culpable for the near financial meltdown. But 30 years of hindsight enable us to judge which elements of the Thatcher revolution should be preserved, and which should be amended in the light of today s global economic downturn.

Yes, the chances of an immediate repeat of the acute financial meltdown of 2008 are much reduced by the fact that most investors, regulators, consumers, and even politicians will remember their financial near death experience for quite some time. As a result, it could take a while for recklessness to hit full throttle again.

The cause of the transatlantic growth gap thus should not be sought in excessive eurozone austerity or the excessive prudence of the European Central Bank. There are structural reasons for the eurozone economy s slow recovery from the financial meltdown in its periphery.

In the United States, all presidential candidates must make pilgrimages to Silicon Valley and other tech centers to raise money. Excessive financial sector influence was, of course, a root cause of the 2008 meltdown and remains deeply implicated in today s continuing eurozone mess.

Many economists argued that these clever models were flawed, because the punishment threat was not credible, particularly in the case of a systemic meltdown affecting a large part of the financial system. But the papers were published anyway, and the ideas were implemented.

This threat means that the financial bailout funds authorized by Congress can legitimately be used to support the automakers. Treasury s refusal to do so is a monumental blunder that risks a general meltdown, the consequences of which will extend far beyond America s shores.

Second, the euro area benefits from an independent European Central Bank whose swift actions to ease liquidity constraints and coordinate monetary policy have recently helped to avert a financial meltdown. Such rapid, coordinated steps by 16 national central banks would have been unthinkable.

One candidate for US President in 2016, former Maryland Governor Martin O Malley, recently launched his campaign by asking why not a single Wall Street CEO was convicted of a financial crime in the wake of the 2008 financial meltdown. It is a good question, the kind that can help the US to overcome its impunity trap.

By contrast, a gap between supply and demand when the corresponding excess demand is for financial assets is a recipe for economic meltdown. There is, after all, no easy way that unemployed workers can start producing the assets money and bonds that not only are rated investment grade, but really are that financial markets are not adequately supplying.

In the similar circumstances of a financial meltdown in 1931, there were also only a limited number of governments that could be effective. The old economic superpower, Britain, was too exhausted and strained to help anyone else.  World s reserves were massively accumulated in the US.

Europe and the United States are both entering recession, and fears are mounting that the financial meltdown accompanying the sub prime mortgage debacle has not worked itself out. All this is happening at a time when inflationary pressures hamper the usual monetary and fiscal remedies.

In the similar circumstances of a financial meltdown in 1931, there were also only a limited number of governments that could be effective. The old economic superpower, Britain, was too exhausted and strained to help anyone else. World s reserves were massively accumulated in the US.

Food insecurity and economic meltdown are the result of bad policies, non transparency and the breakdown of the rule of law.

There are many good reasons for the attention lavished on monetary policymakers, including the rise of central bank independence, public acceptance of the need to appoint highly competent technocrats to oversee the money supply, and the deepening of financial markets. And many central bankers have been rightly lauded for their role in preventing a global meltdown during the financial crisis.

MUNICH With pain and misgiving, the United States Congress bailed out Wall Street in order to prevent a meltdown of America s financial system. But the 700 billion to be used may flow into a leaky bucket, and so may the billions provided by governments throughout the world.

And then I went home that night, and I had an even larger emotional meltdown, which I'll say more about in a minute.

And, while Noyer s position at the central bank makes him independent, he is championing banking sector autonomy in a country led by a left wing government. What is at stake is Europe s capacity to avoid another financial meltdown one that could be even more devastating than the 2007 crisis.

Now, it is becoming increasingly hard to find diplomats or policymakers who support him. French President Nicolas Sarkozy is said to have been disappointed by Barroso s performance during last autumn's financial meltdown, and German Chancellor Angela Merkel also seems to have fallen silent on the matter of his future.

DAVOS The World Economic Forum s annual meeting in Davos has lost some of its pre crisis panache. After all, before the meltdown in 2008, the captains of finance and industry could trumpet the virtues of globalization, technology, and financial liberalization, which supposedly heralded a new era of relentless growth.

The economic crash in the United Kingdom is at least as severe as in America, forcing the government to rely almost entirely on deficit spending to prevent a complete meltdown of its financial system. Brown has few options left, and the UK is nowhere near the worst of the crisis.

The consequences are already visible to avoid a complete meltdown, Cyprus has been forced to introduce capital controls which everyone had thought were illegal and unthinkable within the eurozone. As a result, investors and depositors have learned that the erection of financial barriers within the currency area is indeed a genuine risk.

The current oil price will force Russia to cut its imports by half a move that, together with the continuing rise in inflation, will diminish Russians living standards considerably. Add to that ever worsening corruption and a severe liquidity freeze, and a financial meltdown, accompanied by an 8 10 decline in output, appears likely.