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Financial Crises

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FINANCIAL CRISES CONCERNING INTERNATIONAL POLITICAL ECONOMY

Perpetually since the 20th century, the world economy has been under several

experiments and has been taken to regulate economic crisis in the global therefore most of the

financial markets are alienated across all countries in the entire world. The financial crisis is

defined to as a condition whereby monetary possessions drop their insignificant worth and are

caused by some factors which don't affect the outcome in significant variations in the global

economy (Waelti,17).

The first reason why there is a financial crisis in the entire world is as a result of political

cycle and governance. According to Plato democracy of various countries varies. Therefore, it is

not permanent; it continuously shifts affecting the world economy. Also, the monetary system

has become familiar to all citizens, and as a result few people benefit, reducing classification

resiliency.

Mismanagement of taxes and subventions contributes to the financial crisis. Tax policies

affect the flow of capacity, cost and up to date tax code, therefore, the entire finance require

renovation. The government should aim at reducing temporary assumptions and encouraging

long-term investments, hence each state should safeguard that subventions are insured later

eliminating debt grounded on financing. Politicians have affected the global economy by

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forming trouble cooperation and approving bank mergers and have blackmailed banks efficiently

into providing loans to debtors who are not creditworthy while banks accept the risks

(Pepino,125).

Excessive loss of monetary policies leads to financial crisis. Politics contributes to

extreme loss of monetary policies which causes credit and asset froths which leads to political

attacks leading to debts, unemployment. In most cases, excessive loss of fiscal policies is always

contributed by a state, for example, Japanese government. Some government policies created by

politicians for instance reduction of obligatory deposit, these systems may add to the breakdown

of completion (Jessop, 106).

In conclusion, the current financial crisis is contributed by loans making the countries

and their investors bankrupt, and this has spread all over the international systems. The

government should ensure that they coordinate monetary authorities activate monetary policies

and finally set regulations for bank systems; as a result, they can avoid significant wealth loss.

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Surname: 1 Name Course Tutor Date FINANCIAL CRISES CONCERNING INTERNATIONAL POLITICAL ECONOMY Perpetually since the 20th century, the world economy has been under several experiments and has been taken to regulate economic crisis in the global therefore most of the financial markets are alienated across all countries in the entire world. The financial crisis is defined to as a condition whereby monetary possessions drop their insignificant worth and are caused by some factors which don't affect the outcome in significant variations in the global economy (Waelti,17). The first reason why there is a financial crisis in the entire world is as a result of political cycle and governance. According to Plato democracy of various countries varies. Therefore, it is not permanent; it continuously shifts affecting the world economy. Also, the monetary system has become familiar to all citizens, an ...
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Tags: politics market international relations Economy International Political Economy Why Do Financial Crises Happen?