Greeces Inadequate Response to the International Credit Crisis Term Paper

Greeces Inadequate Response to the International Credit Crisis - Term Paper Example In several areas housing markets suffered heavily, something that led to foreclosures, evictions and prolonged cases of unemployment among several industries. During that time, the crisis is said to have been responsible for the failure and closure of several key businesses (Laskos, & Tsakalotos, 2013), massive drops in consumer wealth, which had been estimated to range in trillions of American dollars. Similarly, the situation caused a huge downturn in economic activities, leading to the global recession of 2008-2012, thus resulting in another crisis, the European sovereign-debt (Shannon, 2014). It is believed that the most active part of the particular crisis that manifested itself in the form of liquidity crisis can actually be traced from 9th of August 2007 (Shannon, 2014). During this time, BNP Paribas is believed to have ended completely all withdrawals from the three main hedge funds because of a total evaporation of the much needed liquidity. This paper examines the concept of the international credit crisis as it happened, focusing on the strategies that Greece use in response towards the crisis including the United States and other European nations. The real cause of the crisis has been a subject of discussion, with different experts giving different opinions and perspectives as to the real causes. The Levin-Coburn’s report from the U.S senate explained that the crisis was brought about by those complex and high risk financial products, failure from the side of regulators, diverse conflicts of interest, agencies in charge of credit rating as well as the market itself, which wanted to rein beyond the Wall Street excesses (Laskos, & Tsakalotos, 2013). On the other hand, the conclusions by the commission of inquiry into the crisis argued that the crisis would have been avoided, had the financial regulators taken effective steps in good time. In this case, they explained that the crisis was to be blamed on financial supervision and regulation