Critical Thinking and Evaluation of Article about Financial Crisis of 2007/2008 in the UK - Literature review Example

Part A Write an essay on the main factors that need to consider when using online resources. Lee, Paik, and Joo indicate that Internet usage in the world has increased significantly in recent years. The increase has been occasioned by the fact many institutions have become technology savvy due to increased use of computers. The increase in Internet usage has particularly been witnessed in the U.K. where more and more people use the Internet. For instance, a survey conducted in 2012 by Internet World Stats showed that about 84.1% of the U.K. populations were Internet users (Ebersole 2005). The study also found out that at least 74.2% of U.K. citizens went online at least once every month in 2012. At the same time, the research found out that learning institutions are among institutions where Internet usage has increased significantly. In this regard, it was discovered that many college and university students in the U.K. are using the Internet for research purposes. This is after a study found out that very few U.K. students still use traditionally printed sources for research purposes as any have resorted to using online resources for sources and referencing, which are also an important part of research requirements in universities and colleges in the U.K. However, the selection of information is arguably one of the most vital steps in seeking information on online resources. The information selection of online resources is determined by a number of factors. Credibility is one such factor that needs to be considered by students in using online resources (Lee, Paik, and Joo 2012). In this regard, before an online resource is chosen, it is usually important to for students to consider how credible and reliable the web resource is. This is because certain resources are not considered credible academic sources as their authors cannot be relied upon. Wikipedia is an example of an online information search engine found on the Internet. However, it is not a credible source to use for research purposes according to Lee, Paik, and Joo (2012). However, students are always advised to rely on credible online sources such as peer-reviewed journals, books, articles, and newspapers. This is because these resources are written by credible authors making them reliable for research and referencing purposes. As such, credibility of resources is a vital factor that students consider when using online resources. Secondly, Lee, Paik, and Joo (2012) argue that students need also to consider the ease of understanding when choosing an online resource. Research is very important as far as learning is concerned. However, online materials differ widely in terms of ease of understandability (Lee, Paik, and Joo 2012). This is because there are some, which are very hard to understand while others are simple. In this regard, research has shown that a majority of students choose those, which are easy to comprehend so as to be able to complete the assigned task within the shortest time possible. For instance, it is common to find a majority of students using website resources than books because online resources are more summarized than books making them easy to understand than books. Language is another important factor that students need to consider when using online resources according to Lee, Paik, and Joo (2012). This is because resources available in the Internet are found in different languages. Some of the languages commonly used include English, French, and Arabic. Therefore, students choose online resources in accordance with the language the language used in the resource. This is because a student cannot choose an online resource written in a language that he or she do not understand well. Therefore, students who understand English can use a Google Scholar to search for articles written in English. Lee, Paik, and Joo (2012) argue that freedom of accessibility is another factor that students need to consider when using online resources. In this case, students have been found mostly to have a high preference to resources that are freely accessible. In fact, research shows that a majority of students conduct most of their online research on the website and articles than any other sources because they can be downloaded free of charge. At the same time, research has also indicated that many students conduct online research on books that are freely accessible at no fee. As such, very few students go to the extent of buying online books because most of these books are expensive. The same applies to other resources that require students to pay some fee in order to have access to resources for research and referencing purposes. Finally, students also need to consider how comprehensive the online materials are (Lee, Paik, and Joo 2012). In this case, the online resource being used should be able to cover areas that other authors have not covered. This will ensure that the student is able to get a wide viewpoint of the research being conducted. Part B The financial crisis of 2007/2008 and its impact on the UK economies Literature Review Dwyer and Lothian (2012) reveal that many countries across the globe were adversely affected by the impacts of the recent financial crisis of 2007/2008. In fact, most countries such as the U.S. and the U.K. still suffer from its effects almost six years after the crisis. The origin of the crisis can be traced back to 1970s when the U.K. and the U.S., as well as the Western European economies began deregulating their financial markets. However, many countries like the U.K. are still grappling with its effect, which did affect its economic growth. Research question The research questions pertaining to the financial crisis includes: How did the crisis begin? How has it impacted on the U.K. economy? What should be done to avoid such an occurrence in the future? Objective The objective of this paper is to explore the origin of the recent financial crisis of 2007/2008 and its impacts on the U.K. economy. To begin with, the genesis of the recent financial meltdown of 2007/2008 date back to 1970s following the move by the U.K., the U.S. and Western European economies to deregulate their financial markets (Dwyer and Lothian 2012, p.47). Deregulation brought about liberalization of the financial market since it did away with government and other regulatory controls, which freed up institutions to trade freely in a wide range of territories and activities. Dwyer and Lothian (2012, p.49) noted that deregulation made banks, building societies, investment banks, insurance companies, and stockbrokers operate a lot on their own specialized trading areas. In the U.S., for example, some organizations were confined to trading in some states while trading in Europe was restricted to institution’s own country (Dwyer and Lothian 2012, p.49). Banks also imposed controls on cash, lending rates, and capital ratios. However, these countries soon after began relaxing their controls thereby allowing financial institutions to source funds from money markets across the global and not just to from depositors leading to speedy growth financial service businesses. This resulted in the liberation of credit and expansion of personal debts such mortgages debts according to (Dwyer and Lothian 2012, p.50). These led to the expansion of the market making some lender to increase their lending rates more than the face value of the mortgage property, which later resulted in the financial crisis. The effects of the financial crisis were first felt in 2007 following the fears of rising fuel prices in the market. The rise in fuel prices caused the prices of other goods and services to increase. The increase in prices affected many U.K. citizens since the price increases forced them to cut down their spending in order to be able to make ends meet. In fact, the inflation rates have remained high in the U.K. since the crisis. For instance, the September 2012 inflation rate rose by 2.2% in October to 2.7%. Oil prices, on the other hand, rose by 9% in the same month. This has made life more difficult to the U.K. citizens who have to work extra hard to meet their needs (Dwyer and Lothian 2012, p.53). The effects of the financial crisis also affected the economy of the country, which has stagnated for a very long time now. In fact, economic pundits still argue that the economy of the U.K. is not likely to recover from the effects of the financial crisis anytime soon. For instance, report indicates that the economy of the U.K. shrunk by about 4.9% in 2009 following the effects of the financial crisis that occurred in the preceding years. Since then, the economy has been at negative figures until the year 2012 when it bounced back a little registering a growth rate of about 1% (Dwyer and Lothian 2012, p.56). The financial crisis also resulted in increased unemployment rate in the U.K. This follows the fact that the crisis made some companies in the U.K. to be liquidated for lack of funds to enable them operate. The liquidation forced some companies and banks out of business except a few that were bailed out by the U.K. government such as Halifax Bank of Scotland (HBOS), Barclays, and HSBC. The closer of banks and companies in the U.K. forced many companies to lay off workers resulting in increased unemployment, in the country. Even after the recession, the government is still not able to create enough job opportunities for its population due to the state of economy (Dwyer and Lothian 2012, p.61). In conclusion, the U.K. is certainly one of the countries in the world that were adversely affected by the recent financial meltdown of 2007/2008. This has seen the economy of the country stagnate for a long time now despite efforts being put by the U.K. government to revamp the economy. Nevertheless, the U.K. government needs to take a proactive approach to introduce strong monetary policies in the country so as to avoid the occurrence of such a crisis in the future. References Ebersole, S.E. (2005). On their own: students academic use of the commercialized Web. Library Trends, 53, 530-538. Dwyer, G.P., & Lothian, J.R. (2012), "International and historical dimensions of the financial crisis of 2007 and 2008": Journal of International Money and Finance. Volume 31, Issue 1, Pp. 1-124. Lee, J.Y., Paik, W., & Joo, S. (2012), Information resource selection of undergraduate students in academic search tasks. vol. 17 no. 1. http://informationr.net/ir/17-1/paper511.html (accessed 4 March, 2013). Read More