Analysis of “the Global Financial Crisis Causes, Effects,...

Fundamental of Economics Analysis of â€Å"The Global Financial Crisis: Causes, Effects, Policies and Prospects† Dominick Salvatore, Journal of Politics Society, Columbia University June 2010 Marija Nikolic December 2012 Global financial crises has brought into focus debate about decisions made by the countries which are leading economic forces, making them to reconsider past living standards and habits. With the aim to examine the causes, effects, policies and prospects for the financial crisis D.Salvatore published the article in June 2010. Additionally author in the same paper suggests reforms in the U.S. macroeconomic decisions as the prevention of future crises. This analysis will first give summary of the main points of the†¦show more content†¦There is also the danger that the large injection of liquidity in the United States and in other advanced countries to jump-start their economies will lead to hyperinflation in two to three years’ time, which would then require a sharp tightening of monetary policy. (Salvatore D, The Global Financial Crisis: Causes, Effects, Policies and Prospects, Journal of Politics Society Columbia University (2010)) The article â€Å"The Global Fin ancial Crisis: Causes, Effects, Policies and Prospects† by D.Salvatore has a clear structure, informative and understandable to wider readers. Explanations are effectively written and prevention measures logically results from previous context of the paper. Indeed, as it is also shoved in the paper, in last decades through globalization process economic barriers are getting removed intensively and overall collaboration in the world increases. Some economists add reasons that precede to the bum on the mortgage market. Through the direct investments of developed countries underdeveloped ones had perspective to gain high rate of economic growth. With the years that followed they, opposite to expectations, achieved higher rates of savings, what created possibility to invest excesses of domestic savings in developed countries. This was opposite to the initial idea of expected behaviour in