What is the reason for the recent economic crisis? How does it affect other countries?

Because in the past for a long time, housing prices were inflated, people used the appreciation of housing prices to take out loans to consume, the higher the housing prices, the more loans, suddenly one day, housing prices no longer rose, but also fell, because housing prices did not rise, no one bought a house, housing prices fell, so the loan was not repaid, the money was not repaid, it went bankrupt, the bank of the loan also went bankrupt, the bank's money was loaned to the past, one fell, and several others were not happy, and the people were afraid that their money would depreciate, and they did not dare to invest. Because they are all bankrupt, so the banks are more and more difficult, other countries are mainly countries that use foreign capital, because people have withdrawn all the funds, or the follow-up funds are not in place, the country will not be able to turn away, export-oriented countries, because consumption has shrunk, exports have decreased.

1. The subprime mortgage crisis is also known as the subprime mortgage crisis (subprime mortgage refers to loans provided by some lending institutions to borrowers with poor credit and low incomes. During the high boom of the U.S. housing market in previous years, the subprime mortgage market grew rapidly. It refers to a storm that occurred in the United States due to the bankruptcy of subprime mortgage lenders, the forced closure of investments, and the drastic.

It has led to a looming illiquidity crisis in the world's major financial markets. The "subprime mortgage crisis" in the United States began to emerge gradually in the spring of 2006. In August 2007, it swept the world's major financial markets such as the United States, the European Union and Japan.

2. The direct cause of the storm in the U.S. subprime mortgage market is the rise in interest rates in the United States and the continued cooling of the housing market. Subprime mortgages are loans made by some lenders to borrowers with poor credit ratings and low incomes. The rise in interest rates has led to an increase in repayment pressure, and many users with poor credit feel that there is a high pressure to repay and the possibility of default, which will affect the recovery of bank loans.

3. How widespread will the "subprime mortgage crisis" in the United States be? This is an issue that the world economic and financial circles are paying close attention to. From its immediate impact:

First of all, it is the large number of home buyers with low incomes who have been hit. Unable to repay their loans, they will face the difficult situation of having their homes repossessed by banks.

Finally, the U.S. and Europe will also be hit hard as many of the investments in the U.S. and Europe are heavily derived from subprime mortgages.

This crisis has undoubtedly brought a lot of inspiration to the domestic financial industry. In terms of financial innovation, mortgage market development, and financial supervision——— since the outbreak of the subprime mortgage turmoil in the United States, the death of subprime mortgages in the United States and even in the world cannot be underestimated from the perspective of fluctuations in the global capital market or changes in the real economy of the United States. For China, this turmoil is a wake-up call for us to be prepared for danger in times of peace.

1. First of all, caused by the subprime mortgage crisis in the United States, the United States excessively issued loans to people who did not have the ability to repay to encourage them to buy houses; The lending bank will evaluate and package this loan to an investment bank (such as Lehman Brothers), and the investment bank will resell this bond evaluation and audit package to other countries (such as China holding hundreds of billions), and the investment bank will also find an insurance institution to underwrite the loan (Fannie Mae and Freddie Mac are the two major mortgage insurance institutions), and these two institutions are managed by the United States;

2. The United States packages and resells such high-risk bonds to other countries, so that the risk is borne by the whole world, thus affecting other countries, which is of course only direct.

3. Indirectly speaking, the United States is the engine of world economic growth and the destination of China's large number of commodity exports; At the same time, the United States has been running deficits for many years, and it has relied on it to issue the US dollar, the world currency, as a premise, and now the US economy itself is not good, and the money is worthless, which has also triggered an economic crisis in countries that hold US dollars.

The reason is the subprime mortgage turmoil in the United States. Because finance is globalized, and there are very serious financial problems in the most developed United States, it is necessary to take a whole seat.

The root cause of the economic crisis was that in an environment of economic freedom, the productivity of the United States increased dramatically, while the standard of living of the people did not rise in parallel. The immediate cause of the economic crisis was the contradiction between production and the sale of spinal fibers, and if this contradiction developed, it led to overproduction. This overproduction has exceeded the ability of the population to pay relative to the purchasing power of the general population.

This is the direct cause of the economic crisis.

First, the decline in consumer spending has led to the inability of factories to sell their products, the loss of workers, the failure of factories to pay wages or layoffs, and the increase in unemployment. Unemployment increases, incomes fall, and consumer spending decreases, creating a vicious circle. So when the economy is booming, the unemployment rate is lower, the products are abundant, the ** is cheap, and everyone has money to spend.

Second, due to the great abundance of products, the factory's products will be oversupplied, which will reduce **, and some will reduce production. But the demand is still increasing, and finally slowly as the inventory decreases, **start**. The money in people's hands is slowly decreasing, and some of them are starting to borrow money to spend, ** starting to **, and the cover of consumer spending has begun to decrease again.

Third, the economy entered a recession, and after a period of depression, it began to expand again, and slowly prospered again, and the economy went through four cycles, recovery, boom, recession, and depression, just like spring, summer, autumn and winter, and so on. Some of the consumption expenditures of one person are the income of another person, and if the consumption expenditure decreases, the income of some people will decrease, and the income will decrease, which in turn will lead to a decrease in consumption. In the end, production shrinks or the goods produced are squeezed, and they cannot be sold.

Fourth, the modern economy generally uses credit overdraft consumption to increase domestic demand, if moderate, it is conducive to economic development, however, excessive overdraft consumption is harmful to the economy. Because credit has a cycle, let's take a family consumption as an example, if a family starts to have no money to spend, the bank gives a limit of 100,000 yuan, he consumes the 100,000 yuan a year ago, and in the second or third year, in order to repay the debt, he no longer consumes excessively.

Fifth, because the factory saw the increase in consumption in the first year, it felt that there was a market and would increase production, but in the second and third years, the factory produced a lot of goods, and because people had no money to eliminate the Tong fee, they could no longer spend it through borrowing, and the income was used to pay off the debt.

So it leads to overproduction. This kind of product is relatively excessive, and some products are in short supply, such as daily necessities, Zen products, and food. That's why when the economy is in crisis, the food and vegetables in the supermarket are snapped up.

Maybe the car, or some mid-to-high-end goods, can't be sold. Factories will go out of business.

The economic crisis is the inevitable product of the capitalist economy, because the biggest drawback of the capitalist mode of production is the contradiction between the socialization of production and the private ownership of the means of production, which constitutes the two most basic contradictions of capitalism with the organized production of individual enterprises and the non-existent state of social production.

When these two major contradictions develop to a certain extent, an economic crisis will occur, and the emergence of economic crises is cyclical."

In capitalist society, there is a tremendous development of the productive capacity, but this productive capacity is not a planned production of products according to the actual needs of the working masses.

Rather, through the capitalists blindly arranging the production of products according to the lagging information of the commodity market, a large number of commodities are produced without overall planning, which will inevitably lead to a relative shortage of demand for the working masses to pay, resulting in a large number of surplus commodities and an economic crisis.

Extended information: What was done in response to the economic crisis at the time:

1. Emphasize the spontaneous adjustment role of the market mechanism.

The neoclassical economic theory represented by Marshall holds that only the market can achieve high efficiency as a tool for resource allocation, and that the state's intervention in economic life will not only fail to promote economic stability and growth, but will restrict the self-improvement and self-regulation of the market economy.

Neoliberalism advocates deregulation, greater openness to international ** and investment, and the free flow of capital, money, and services.

2. Emphasize the establishment of small ** and reduce ** expenditure. Friedman proposed that "the least managed **is the best**", opposing state intervention; Neoliberalism advocates reducing spending, strictly controlling the money supply and reducing many regulations in the name of reducing the role of **;

cutting public spending on social services such as education and health care; Cutting the "safety net" for the poor.

3. Emphasize the protection of private property rights and advocate privatization. Hayek believed that private ownership is the best system, and resolutely opposed public ownership, believing that the implementation of public ownership would inevitably lead to totalitarian rule, so that individuals would be enslaved;

Neoliberalism advocates a comprehensive "privatization campaign" in the field of ownership of the means of production, giving state-owned enterprises to private investors, including banks, major industries, railways, tax-collecting roads, electricity, schools, hospitals.

4. Hu Suimeng emphasized the establishment of individual responsibility and opposed the welfare state. According to Hayek, the welfare state ignores the necessary conditions for a "spontaneous order" in a free-market economy;

Neoliberalism advocates abandoning the concept of "public goods" or "community" and replacing it with "individual responsibility", proposing the "centrality" and "ultimate responsibility" of the individual in the economy and even society, and weakening the function of the "welfare state".