2008 Financial Crisis

George W Bush

Definition and Summary of the 2008 Financial Crisis
Summary and Definition: The 2008 Financial Crisis or Banking crash led the modern Great Depression, also known as the Credit Crunch. The 2008 Financial Crisis refers to the period of severe economic downturn between 2008 and 2013 with low growth and rising unemployment and homelessness. The 2008 Financial Crisis was sparked by a loss of confidence by investors in the mortgage and loan markets in the United States. The close interaction of banks across the world resulted in a global liquidity crisis. There was  sudden reduction in the easy availability of loans or credit from banks and mortgage as lenders insisted on stringent checks before any bank or mortgage loans were approved.

2008 Financial Crisis
 George W Bush was the 43rd American President who served in office from January 20, 2001 to January 20, 2009. One of the important events during his presidency was the 2008 Financial Crisis aka the Great Depression or the Credit Crunch.
     
   

2008 Financial Crisis Facts for kids
The following fact sheet contains interesting facts and information on 2008 Financial Crisis.

2008 Financial Crisis Facts for kids

2008 Financial Crisis Facts - 1: The 2008 financial crisis led to the worst recession since the infamous 1929 1929 Wall Street Crash and the Great Depression.

2008 Financial Crisis Facts - 2: The financial crisis was sparked by loan companies supplying easy, expensive home loans by borrowers who had a poor credit history, or could not prove their incomes, and held a greater risk of loan default than prime borrowers - these risky transactions were known as subprime loans.

2008 Financial Crisis Facts - 3: From 1997 until 2007 it was easy to get a loan or a mortgage. New loans were made attractive to borrowers and many people re-mortgaged their homes due to low interest rates.  As a result of easy credit, house prices rose and both US and foreign investors, including many banks, invested in subprime loans which gave a good return on the investment.

2008 Financial Crisis Facts - 4: House builders, reacting to the increased number of people who could obtain loans, built too many houses.  In 2007 the price of houses began to fall and the housing buble began to collapse.

2008 Financial Crisis Facts - 5: Interest rates rose, and numerous subprime mortgage borrowers began to default on their loans. Subprime borrowers found that the value of many homes dropped below the value of the remaining mortgage debt (negative equity).

2008 Financial Crisis Facts - 6: During 2007, almost 1.3 million Americans lost their homes due to foreclosure as lenders and loan companies repossessed mortgaged properties when the borrowers failed to keep up their mortgage payments.

2008 Financial Crisis Facts - 7: The United States Federal Reserve (Fed) injected 43 billion US Dollars and lowered interest rates as the housing crisis began to grow.

2008 Financial Crisis Facts - 8: The financial crisis spreads to Europe. The Internet bank 'NetBank' goes bankrupt and the British Government is forced to take over Northern Rock, a major UK bank, as the disaster deepens. In December 2007 the European Central Bank (ECB) lends $500bn to banks at below-market rates.  

2008 Financial Crisis Facts - 9: The 2008 financial crisis is heralded in January 2008 as shares begin to fall on the stock markets. House prices continue to fall, unemployment begins to rise as jobs are cut and houses continue to be repossessed.

2008 Financial Crisis Facts - 10: In March 2008 the investment bank Bear Stearns becomes a major casualty and is bought out by JP Morgan. By August Morgan Stanley, Washington Mutual  and Goldman Sachs all come under pressure.

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2008 Financial Crisis Facts for kids

Facts about the 2008 Financial Crisis for kids
The following fact sheet continues with facts about 2008 Financial Crisis for kids.

2008 Financial Crisis Facts for kids

2008 Financial Crisis Facts - 11: By September 2008 Merrill Lynch is sold to the Bank of America. Washington Mutual and the Wachovia go bankrupt but the when the Lehman Brothers also go bankrupt it triggers a worldwide financial panic.

2008 Financial Crisis Facts - 12: The US government is forced to take over 'Fannie Mae' (Federal National Mortgage Association) and 'Freddie Mac' (Federal Home Loan Mortgage Corporation), two massive firms that had guaranteed thousands of sub-prime mortgages, fearing that a systemic global financial crisis would prompt the biggest depression since the 1930s.

2008 Financial Crisis Facts - 13: Countries across the world begin to fall into recession, three major banks of Iceland (Glitnir, Kaupthing, and Landsbanki) are nationalized.

2008 Financial Crisis Facts - 14: The stock market continues to fall and confused governments frantically cut interest rates to ease the situation in a desperate, coordinated attempt to prevent the collapse of the banking sector.

2008 Financial Crisis Facts - 15: Global stock markets report the biggest annual falls for 24 years and the G20, an international forum for the governments and central bank governors from 20 major economies, agrees on a global stimulus package worth $5 trillion

2008 Financial Crisis Facts - 16: In 2010 the financial crisis hit Greece, Portugal and Ireland who were bailed out by the Eurozone on condition they implement austerity measures.

2008 Financial Crisis Facts - 17: The 2009 Wall Street Reform and Consumer Protection Act was passed by Congress on December 11, 2009.

2008 Financial Crisis Facts - 18: On January 27, 2010 President Barack Obama declared that, "the markets are now stabilized, and we've recovered most of the money we spent on the banks."

2008 Financial Crisis Facts - 19: The Restoring American Financial Stability Act of 2010 was passed on May 20, 2010.

2008 Financial Crisis Facts - 20: The Dodd–Frank Wall Street Reform and Consumer Protection Act was enacted on July 21, 2010.

2008 Financial Crisis Facts - 21: US Congress released the Financial Crisis Inquiry Commission report in January 2011, and another report entitled Wall Street and the Financial Crisis was released in April 2011.

2008 Financial Crisis Facts - 22: The storm of buyouts, bankruptcies, bailouts and collapses that had resulted in a terrible period of recession in the United States lasted until 2013.

2008 Financial Crisis Facts for kids

2008 Financial Crisis - President George W Bush Video
The article on the 2008 Financial Crisis provides detailed facts and a summary of one of the important events during his presidential term in office. The following George W Bush video will give you additional important facts and dates about the political events in his presidency.

2008 Financial Crisis

● Interesting Facts about 2008 Financial Crisis for kids and schools
● Summary of the 2008 Financial Crisis in US history
● 2008 Financial Crisis of important, key events
● George W Bush from January 20, 2001 to January 20, 2009
● Fast, fun facts about the 2008 Financial Crisis
● Foreign & Domestic policies of President George W Bush
● 2008 Financial Crisis for schools, homework, kids and children

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