Credit crunch Essay Example | Topics and Well Written Essays - 1000 words

Credit crunch - Essay Example The people have started to understand the real issues behind this credit crunch because it has impacted their lives in a very negative way. It has turned the rich into poor very quickly and the poor have no where to hide as well (Author Unknown 2008). In essence, the credit crunch has played absolute havoc with the people of this world and there seems to be no stopping on this premise at all. Much needs to be done and for that to happen, the world’s biggest financial and economic bodies need to sit down together and devise a way for further progress and resilience within these areas. The historic basis of this credit crunch started when some of the world’s leading banks and financial institutions came down crashing some 2 years back. It brought with it a plethora of issues and troubles for the people, be them within the small sized markets or within the big institutions that played with the economic issues of the people. The move destroyed the basis of any economic activity within the world and hence these activities came to a standstill all of a sudden. American and British companies started to see downsizing and job cuts, which meant that more people started to lose their jobs and they had to bear the direct consequences due to this credit crunch. What was worse was the fact that the established companies which were doing pretty well within the global contexts also came down crashing (Anderson 2007). The liquidity basis was therefore hit very badly and the people within the financial groups were blamed for such a situation that had arisen in the first p lace. The historic basis of credit crunch has resulted due to a number of reasons apart from these as well. The dependence of one money regime over the other has also been the root cause behind such debacle in the first place and therefore the blame must be shared amongst all concerned. What is worst is the fact that people have been at the mercy of such financial