Three stages of financial crisis within the US Essay

threesome stages of financial crisis within the US - Essay ExampleIn September 2008, Lehman Brothers announced that it was facing failure which created an overall panic all across the board. US government and other western government started injecting notes into the banking system to stop big banks from going bankrupt. Moreover, credit flows to the private sector also stopped create US economy and other economies to slow down. Interest rates were also increased in high society to adopt a cautious approach in such difficult circumstances. Later in the winter season of FY09, US and other G20 countries started to cut dwon interest rates, so it could stop economy going into objurgate (Elliott, 2011).Later, when risks of banks solvency reduced, the focus shifted on government issues. High fiscal deficits caused governments to face severe problems as the economies were going through an overall slowdown. Different European countries like Spain and Greece went into deep trouble due to t he balloon fiscal deficit. IMF and EU had to inject money into their system in order to maintain smooth