Financial Market Analysis FINC20007 Financial Market Analysis FINC20007
Executive summaryThis report presents discussion about the global financial crisis effect on highly globalised financial markets. It is representing the globalization and integration of financial markets, financial crisis, effects overview, critically analyzing the effects of financial crisis and finally remedial action. The conclusion of the essay clarifies some key points and provides a personal reflection on the topic of the global financial crisis.This financial crisis affected the credit market and shadow banking system, financial institution and public wealth effects which describe the different credit unions, financial institution and on the personal wealth effect with the figures and charts to clarify and analyze the effects on the financial market.At last, the report provides few remedial actions to resolve the situation which caused by this financial crisis includes adopting tight fiscal policy, implementing low interest rates, conducting some microeconomic reforms and offering housing mortgage assistances to make sure that such disastrous crisis do not occur in the future again.Table of Contents11.0 Introduction 22.0 Globalization and Integration of Financial markets 22.1 Courses 22.2 Benefits 32.3 Negative influences 33.0 Financial Crisis 33.1 Introduction 43.2 Courses and Processes 44.0 Effects overview 54.1 Effects on credit market and shadow banking system 64.2 Effects in financial institutions 74.3 Public Wealth effects 85.0 Remedial actions 95.1 Tight fiscal policy and low interest rates 95.2 Microeconomic reforms 95.3 Housing mortgages assistance 106.0 Conclusion 117.0 References 128.0 Appendix 1.0 IntroductionFinancial crises have mediated the operation of financial markets over years. Most noticeably the great depression in 1929-30, the 1970s inflation crises and the banking crises in the 1990s created destruction in the financial markets causing severe interruption. The current financial crisis which emerged in 2007, although the roots were sown much earlier, has been one of the toughest and probably the biggest that financial markets have ever encountered. Referred to as the credit crunch, the impact of the crisis has not only been on the banking sector, but on the real economy as a whole potentially leading to a long and deep recession.2.0 Globalization and Integration of Financial markets2.1 CoursesAs the dramatic technological changes and the subsequent development of means of communication, Globalization has become commonplace since the mid-1980s. Thus the process of financial and economic market integration has been promoted, which has been marked by huge amounts of capital flows among developed and developing countries (Prasael et al. 2003). Various international financial institutions such as the International Monterey Fund (IMF), the World Bank, the World Trade Organization (WTO) and the Bank for International Settlements (BIS) were develo...
