Global Economic Collapse 2008 and 2013 Reasons and solutions
                     Global Economic 
Collapse 2008 and 
2013: Reasons and 
solutions
Financial Crisis 2008
Financial crisis of 2007–08, also called subprime mortgage 
crisis, severe contraction of liquidity in global financial 
markets that originated in the United States as a result of the 
collapse of the U.S. housing market.
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Source: www.britannica.com
Causes of the crisis
The financial crisis was primarily caused by deregulation in 
the financial industry. That permitted banks to engage in 
hedge fund trading with derivatives. Banks then demanded 
more mortgages to support the profitable sale of these 
derivatives. 
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Source: www.britannica.com
Subprime lending
The relaxing of credit lending standards by investment banks 
and commercial banks allowed for a significant increase in 
subprime lending. Subprime had not become less risky; Wall 
Street just accepted this higher risk.
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Source: www.britannica.com
How did politicians and policymakers 
try to ‘solve’ the 2008 financial crisis?
In February 2008, President George W Bush signed the 
Economic Stimulus into Law. The US President also approved 
the Troubled Asset Relief Program (TARP) in October 2008. 
TARP provided $700 billion in funds to purchase the assets of 
struggling company.
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Source: www.outlookindia.com
Financial Crisis 2014
The financial crisis in Russia in 2014–2015 was the result of 
the sharp devaluation of the Russian ruble beginning in the 
second half of 2014. 
A decline in confidence in the Russian economy caused 
investors to sell off their Russian assets, which led to a 
decline in the value of the Russian ruble and sparked fears of 
a financial crisis. 
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Source: en.wikipedia.org
Causes of the crisis
The lack of confidence in the Russian economy stemmed from 
at least two major sources. 
• The first is the fall in the price of oil in 2014. Crude oil, a 
major export of Russia, declined in price by nearly 50% 
between its yearly high in June 2014 and 16 December 
2014. 
• The second is the result of international economic 
sanctions imposed on Russia following Russia's annexation 
of Crimea and the Russian military intervention in Ukraine.
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Source: en.wikipedia.org
Affects of the crisis
The crisis has affected the Russian economy, both consumers 
and companies, and regional financial markets, as well as 
Putin's ambitions regarding the Eurasian Economic Union. 
The Russian stock market in particular has experienced large 
declines, with a 30% drop in the RTS Index from the beginning 
of December through 16 December 2014.
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Source: en.wikipedia.org
Fall in oil prices
The Russian economy depends largely on crude oil exports. In 
February 2014 crude oil prices started to slide down due to 
the boom in American shale oil production. For every $1 
decline in crude oil prices, the Russian economy loses billions 
of dollars.
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Source: en.wikipedia.org
Recovery
Russia’s economic outlook today is much more positive than 
it was just a few years ago. Oil prices have rebounded. 
This is a key development given how much of the economy 
still depends on oil and gas. The country also appears to have 
weathered Western sanctions for now, even getting a small 
boost from new sanctions on a different oil producer, Iran. 
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Source: en.wikipedia.org
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