On October 20, 2008
Economic crisis in the United States: Part 1
For: 100 Business In: Business ambience
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The crisis in the United States is a topic appellant in the discussions of universities and heads of state. In this first delivery we speak about the causes of the American crisis. In future deliveries one will speak about the aftereffects for Latin America.
It is necessary to speak that the origin of this crisis goes back to 9/11, on famous September 11, date in which the Twin Towers of World Trade Center in New York, were attacked by terrorists. Then, the government of the president Bush fitted the economic politics that possibly generated the stage of crisis through that one lives at present.
It is not necessary to be wrong, this crisis comes from the financial system, from the bad bank handling and from a brutal greed in Wall Street. It is not a crisis originated from the normal business, but of the whole dirt in the banks. This has happened several times in Latin America. Perhaps the crisis model is the Mexican of 1994-1995, where the famous person FOBAPROA had to create the government to buy the debts of banks that came to the bankruptcy. It is the same case in EUA.
Originally, the North American crisis began for credit mortgage. The people who might not pay his houses, obtained type credits suboccupy first place. This means that they performed high risk for the economy, but they were generating good money for the banks. Which set sail to the people not to be able to pay his credits. Little by little the inflation, the unemployment, the economic conditions and other factors, they did that there were happening a cascades of abandonment of these credits. The banks were not prepared for this type of situation.
What it spent since then was that the value of the house collapsed. The North American banks had to ask for more money and in some moment, many went to the bankruptcy on having had lacking in capital in work. Where this is difficult really now loans do not exist to small business and solid companies. There exists a capital absence that it hangs to the economy.
We have seen that this has caused panic on the markets and has forced them many North American companies to declare itself in bankruptcy (and to use the famous Chapter 11). The contagion has happened towards Europe, Asia and Latin America. A problem that it has worsened for the inflation rampante that had beating to the region Latin America. In Spain, in particular, the mortgage problems and of liquidity they have been capital.
In next deliveries one will speak about the consequences for the business in Latin America of this one crisis. The interesting thing is that there will be more business opportunities in times of crisis for which they can make use of them.