Subprime mortgage crisis The s were the decade of subprime borrowers; no longer was this a segment left to fringe lenders.
February 13, Project Topic: In the US there are three types of mortgages namely: Conventional, interest-only and sub-prime. This makes it cheaper than a conventional mortgage. Sub-prime mortgage is granted to borrowers whose credit history is not sufficient to get a conventional mortgage or who do not quality for market interest rates owning to various risk factors such as income level, size of the down payment made, credit history and employment status.
As the defaults in sub-prime US mortgage mounted, institutions had a rethink on their attitudes to risk and suddenly became scared of losing money.
Banks became unwilling to lend to each other fear of not getting their money back. The panic spread to shares and finally from financial markets to hit the wider economy. But the damage had been done and the global economy has taken a beating, the extent of which is yet to be determined.
In Nigeria, it first came by a meltdown of the capital market, but as price depreciation continued unabated, the authorities decided to have a second look at the market. The market fundamentals were strong, what could therefore be wrong with the market?
Secondly, dwindling petroleum prices which means a severe reduction in foreign exchange earnings, which in our case, derive over whelming form the petroleum sector. Deriving from the above is the deficit in Federal Government budget narrowing down to State and Local Government allocation, there is also less of jobs and a slow down in fight against poverty.
Thus, as Komolafe Babajide US investors in a bid to save some of their investment at home started calling home their foreign investments including those in Nigeria. This gave rise to a glut of shares in the market, which prompted the sharp depreciation of share prices. The impact of this on the Nigerian stock exchange has been quite severe as the market capitalization tumbled more than 30 percent within the period Vanguard Contrary to earlier claims that the Nigerian economy is insulted, the crisis soon infected the entire capital market.
This was due to the decision of foreign investors to pull out their funds from the market leaving it saturated with stocks. The problem thus spans from the indications that a sustained investment in stocks is needed to rally investor confidence.
This study is therefore out to investigate this global economic meltdown or downturn as it impacts on the Nigerian Economy.
This then implies that some key sector of the economy may suffer a set back and our oil and gas sector may not be spared. Hence, the decision making machineries have come to agree indeed that there is a huge complex theory threatening their propaganda instinct.
Financial meltdown can also take a steep price of consequence on the entire population.
This is revealed in Financial Vanguard The big question then was why did a domestic problem in faraway USA become so profound as to take a toll on the Nigeria people?
I personally, felt it is just one the negative consequences of globalization: The researcher also finds out that though not surprisingly that a complete new approach may prove to be a more viable solution to the current economic nightmare.
As Governments across the globe retreat to the drawing board in search of answers, operators and stakeholders in proffering solutions have stated that the remedies lie with no economic theory, but in confidence building measures. Although the Nigerian government has rolled out series of bad out packages to cushion the effect of the crisis on both the private sector and the public ones, it appears the economy is still sinking deep in to recession.
The issue of government intervention and its efficacy remains the crux of this research. This is borne out of the fact that economic destabilization remains the bane of national tragedy.
Thus finding a better medium of recovery is often the big problem confronting the authorities.Economic collapse is any of a broad range of bad economic conditions, ranging from a severe, prolonged depression with high bankruptcy rates and high unemployment (such as the Great Depression of .
In its definition an economic meltdown is a situation where a country’s economy experiences a sudden downfall due to financial crisis; this causes the economy to also go through a falling GDP (gross domestic product), a dry liquidity period and fluctuating rates of inflation and deflation.
The Amnesty International Report highlights the impact of the economic crisis on human rights across the world, calling for a new deal on human rights to .
the impact of the global economic meltdown on the achievement of the millenium development goals in nigeria. a study of ebonyi state lilian nkechinyere otuu. Measured by its impact on global economic output, the recession that had engulfed the world by the end of figured to be sharper than any other since the Great Depression.
The two periods of hard times had little else in common, however; the Depression started in the manufacturing sector, while the current crisis had its origins in the. To examine the factors and sequences of event resulting in thus meltdown and the impact of economic meltdown on Nigerian economy.
To determine the effectiveness of government monetary policies in addressing the situation.