We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Nobody downloaded yet

Sub-Prime Mortgage Crisis and the East Asia - Research Paper Example

Comments (0)
Summary
Name Professor Course Date Introduction The global economy is affected by the world financial and economic crisis that has become harsh since the mid of 2008. This crisis is as a result of the introduction of the subprime mortgage issues in the United States that manifested in the mid of 2007…
Download full paper
GRAB THE BEST PAPER
Sub-Prime Mortgage Crisis and the East Asia
Read TextPreview

Extract of sample
Sub-Prime Mortgage Crisis and the East Asia

Download file to see previous pages... The subprime mortgage crisis in the United State was more severe than the great depression because several assets and derivatives had been purchased and sold in the unstable market. Moreover, the subprime mortgage crisis had several liquidity risks compared with that of the exchange traded products. According to Justin and Boris (2011), commercial banks finance in the East Asia asks for the mortgages without considering the credit evaluation of the borrowers. Thus, the paper will evaluate the financial crisis issues that were triggered from the U.S sub-prime mortgage crisis, and affected the East Asian economy. The sub-prime mortgage crisis The sub-prime mortgage crisis was a result of the speculative issues in the housing market that commenced in the United State in 2006. It has caused severe impact across the East Asia countries in the form of financial crisis and the country’s credit crisis. Justin and Boris (2011) indicate that the forces caused by the sub-prime mortgage crisis will probably run out of control for years, causing the collateral damage. The disruption in the East Asia countries credit market is of historic proportions and will have significant economic impacts. Moreover, the crisis has caused essential societal changes that affect the consumer habits and the values. Justin and Boris (2011) indicate that the East Asia economy was affected where the GDP was recorded 4.2, 4.8, 5.7 and 1.9 per cent from 2005 to 2008. This led to the ever recorded a decrease in GDP in 2009 that amounted to -4.0 since 1980. Therefore, this crisis has significantly affected the Europe and Asian countries, and most of the Asian countries have rearranged their financial and banking industry. Delgado and Burge (2009) claim that the proximate cause of the sub-prime mortgage crisis was the busting of the housing issues in the East Asia during the summer of 2007 when subprime defaults commenced to rise and foreclosures increased. It then spread to prime loans and other types of consumer credit, and the financial institutions with the subprime related products were severely affected. The Asian countries were severely affected by the sub-prime mortgage crisis during the early stage of the crisis because the banks were not exposed to the dangerous assets that were engineered and crafted in the United State. According to Delgado and Burge (2009), the data gathered in the Economist and Financial Times, the $500 billion was written off by banks globally in the 2008. The financial institutions in Japan accounted for only five percent, and its sectors were relatively resilient. The global financial crisis has affected the China and Japan very strongly as they stand among the most opens in the world. Foreign capital inflows declined significantly as commercial banks and foreign institutional investors withdrew funds to meet redemptions in their countries. According to Delgado and Burge (2009), private capital flows in China slowed from $516.7 billion to 2007 to an estimated $134.4 billion in 2008. Table of the GDP of the East Asia countries 2007 2008 2009 China 11.9 9.7 8.5 Japan 2.1 0.5 -0.2 Korea 5.6 3 3.9 2.1 Modified from: IMF (2008a) According to Ghon (2008), the Banking leading declined that was as a result of the direct and indirect equities. During 2009, the capital flows were estimated to be only $44.1 billion, and in the beginning of 2008, stock markets declined by about 62 percent in China (Ghon, 2008). Thus, the Chinese stocks markets had been the worst performer in ...Download file to see next pagesRead More
Comments (0)
Click to create a comment or rate a document
CHECK THESE SAMPLES - THEY ALSO FIT YOUR TOPIC
International Relations to East Asia
It is worth noting that China is currently the emerging economic power next to the United States. An analysis of the political and economic system enables one to understand the current relations in East Asia and the probable future of China as a global economy.
10 Pages(2500 words)Research Paper
Monastic Buddhism in South East Asia
It has its own educational and training set up exercised and practiced in monasteries. In Southeast Asian countries, like other parts of the world, Buddhist monks observe certain codes and practices within temples and no doubt, there is found sharp differences between a layman approach and a monk approach towards religion and its practical aspect.
11 Pages(2750 words)Research Paper
Impacts of the recent mortgage crisis on the money supply in the United States and the actions of Federal Reserve take in response to the mortgage crisis
Impacts of the recent mortgage crisis on the money supply in the United States and the actions of Federal Reserve take in response to the mortgage crisis Impacts of the recent mortgage crisis on the money supply in the United States and the actions of Federal Reserve take in response to the mortgage crisis.
4 Pages(1000 words)Research Paper
Environmental Issues in South East Asia
The author of the text gives detailed information concerning the South East Asia environmental issues. Admittedly, most of these environmental issues arise due to the activities of man aimed at generating income. Notably, the economic activities that individuals undertake greatly contribute to the global environmental issues that are currently witnessed.
9 Pages(2250 words)Research Paper
Sub-Prime Mortgage Crisis
The crisis associated with sub-prime mortgage ultimately made considerable rise in the quantity of foreclosures as well as defaults (Jaffee, 2008). In this paper, the aspect of the crisis relating with sub-prime mortgage that was faced by United States and several root causes of the crisis will be discussed.
3 Pages(750 words)Essay
Subprime Mortgage Crisis
While mortgage and house markets downtowns have been causes of economic problems in various parts of the world, but experts assert that this situation is unique (Simkovic 257). This study reveals that, the uniqueness of their situation explains for the first time ever downturns are motivated by a credit crisis in the non-banking area of finance, which is contrary from the norm, whereby such actions have created downturns in the general economy through a credit crisis in the banking zone.
7 Pages(1750 words)Research Paper
Water Crisis in the Middle East
Water Crisis in the Middle East. Water is an important element for the survival of the human race. It is a basic necessity but approximately one third of the population of the world is deprived of having access to purified drinking water. Analysts have assessed that the problem of the shortage of water will deteriorate with time owing to the increasing demand.
3 Pages(750 words)Research Paper
What went wrong in measuring and managing risk associated with financial institutions
nderstand how the ladder fell on the ground, it is significant to research the products’ line and get knowledge on the overall financial portfolio; why it crumbled. An attempt has been made to understand the basic functioning of each of the major financial risks including
12 Pages(3000 words)Research Paper
East Asia Culture Research Paper
This definition implies social interaction with other people and through this interaction, understanding is made possible and patterns of behavior are manifested. Other authors define culture as “values, symbols,
5 Pages(1250 words)Research Paper
East Timor Research Question - East Asia Research Paper
East Timor has rich offshore natural gas and oil deposits and is the second largest oil producer after the Middle East. Some other resources found in East Timor are gold, petroleum,
12 Pages(3000 words)Research Paper
Let us find you another Research Paper on topic Sub-Prime Mortgage Crisis and the East Asia for FREE!
Contact us:
+16312120006
Contact Us Now
FREE Mobile Apps:
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us