Asses effects of 2008 Global financal crisis on international business Essay

Asses effects of 2008 Global financal crisis on international business - Essay Example Changing Context After 2008 The context of the global financial crisis began in the year 2006 when the United States experienced a downfall from the real estate market. This accumulated into the lending of banks and other sectors of the economy, all which led to an inflation of prices and the inability for individuals within the economy to continue to pay the same amount of prices because of the economic downturn. The result was a large loss of money that was in the economy and which created difficulties among those that were in the economy. There were several factors that implied that changes needed to be made and which were altered with policies, reforms and different ways of functioning through both policy organizations and those who were involved in lending functions. The context after 2008 led to ways to try to merge back into a functioning economy by changing the macro – economic variables that were associated with the initial crisis (Furceri, Mourougane, 1: 2009). When looking at the context that occurred after 2008, it can be seen that there were several specific changes within the economy that led to the alterations of what was occurring. ... Emerging markets were not as affected; however, those who were a part of the global capital markets noted the first decline since a continuous flow that occurred from the 1980s. This particular crash was as bad as the Great Depression but caused several types of declines because of the complexity that had grown in the economic market. The most affected area was the government with a large amount of increased debt, while the private debt remained flat, making the debt to equity ratio higher and imbalanced. The several occurrences led several to question how to rebalance the economy for the future and to buffer the pressures and declines which could occur within the economy (Roxburgh et al, 7-9: 2009). The changing alternatives in the balances and global market have led to fluctuations that have not only changed the context with certain aspects of the economy but are affecting different institutions. The main institution which has been affected is the government, specifically with a ri se in the deficit by trillions of dollars. There are also changes in the amount of money that is available with sovereign default, which is changing the association with how much can be done to recover within the economy. The changes that are occurring are now not only dependent on an emergence of the economy through the institutions and banks, but also are requiring policy changes that are a part of the economy to provide sustainability. The economic model that is a part of this is one which is creating a change in how policies are approached, specifically because of the credit, assets and amount of deficit that is impacting both the institutions and the basic uncertainties that are within the market (Cuadra, Sapriza, 78: 2008). Alterations in

Economic and Political Situation in a Developing Country (India) Essay

Economic and Political Situation in a Developing Country (India) - Essay Example The research paper Economic and Political Situation in India discusses the Foreign Trade Policy of the country and Indian economy’s resiliency. India's economic growth and foreign trade has taken new dimensions in recent years and it has expanded considerably. Looking at the huge population base of India, this is indeed a good sign for the country and the world economy. For last several years, India’s GDP is growing at the average rate of more than 7 percent; however in order to maintain high economic growth rate and a recognition in the International arena, India needs to continue with high-powered performance in foreign trade. India's major policy initiatives began in July 1991, which catapulted the country in the high growth rate trajectory. The reforms undertaken were responsible for high export growth rates in the last few years. International trade is likely to become a major stronghold of the Indian economy if the country continues with more reforms in years to c ome. An independent monetary system is essential for a country to manage macroeconomic factors and for the smooth economic growth of the country. In this perspective, it is pertinent to study the monetary system of India. The Reserve Bank of India (RBI), the central bank, has money management policy in the form of regulating base interest rates and making changes in Cash Reserve Ratio. Objective is to contain inflation rate and liquidity in the market to stabilize macro economy of the country. Besides, RBI also announces a credit policy every quarter.