When it comes to "Globalmelt Down", everyone of us knows that its due to "America" and its spread from there."Lehhman BROS " case is well known to us.
But my point is that when this crisis was developing, every one was recognizing its as an success. yes off course i m talking about 1990s. If u believe in nos. then let me tell u that.
in 1950 America has taken "200 billion $" from rest of word.in 1980s that goes to "900 billion$" in 2000 it rises up to "3200". present which is "9000".
it wil twitch ur thought if u think why this all happen.
In 1980s rate of interest was 23% on saving.so who is going to invest in share.
so people are just believing in saving. only 5.2 5 people are concern with share market
but in 1990 rate of intrest on saving reduced to 9 %. so %of people concering to share market rises to 25.
and now its goes to 55 %.Secondly Banking sector stared giving loan at low interest rate
and hence American economy model changed.people who first were saving now believes in investment and expension.
when you have the money u can expend it. but model of American Economy states that its not necessary that u have to have the money in your pocket rather if u have the money in some others pocket still u can expend.
soon other countries of word started to give loan to america to buy their product.last year it selg china has exported "30 kharab $" good to america.
india was not behind that. in 1990 when Manmohan Singh were finance minister. such type of cultre came.but still we adopt saving more than expenditure.
in india 35 %of GDP is saving.So as far as i concern being extravagent was one of the major reason behind global crisis.
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7 comments:
Well thought...i Agree with you.The root cause of this meltdown is definitely Extravagance.
its a good poem actually the reality of our four years i mean reality of every engineer. i liked the line abhi gopiyo se kam chalao radha to ghar wale dhoond ke denge.........................................
waah re bacchu ye shok bhi farmate ho aap...
nice job ;)
Bro the analysis which you have done about this bloody recession is astounding. This article has proved that you are not only a good engineer but also a good financial analyst.
Mr. Bothra ans my question...
As we know that the ppl of america saved a lots of money during the period of 1950 to 1990 and after that when the interest rates fell down then they took loan from the banks and during the year 2008-2009 when the banks started recovering the money from the ppl , they were not able to do so.......but since they had lots of money during the 1950's to 1990's then why were the banks not able to recover the money?????????????????
MY BRO at some exyent u are right
but i think i should tell u the whole story why the recesson has come..
let me tell
Bro that is what i m telling in 1950 to 1990 they have changed their nature of saving to expenditure
people are not beliving in saving as they have lot of monet and during 1990 they have spent all most of money still bank are providing them a lot money.. and bank are giving them loan at all most zero percent intrest rate even wo knowing their paying back capacity,,, and when they could get a eye on this it was too late ,,hope u have got..
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