scroll to top
Stuck on your essay?
Get ideas from this essay and see how your work stacks up
Word Count: 1,809
Clair and Tucker 1993 state that the credit crunch has been used to clarity credit supply shortage There will be a reduction in the quality of financial organization capital with conditions imposed by a bank controller that require banks to hold more capital than in previous periods According to Wall Street a credit crunch is a period when transaction wealth comes at a higher risk and a higher cost The banking crisis spreads globally and affects greatly the American society The stock exchange markets throughout the world perform poorly One of the causes of the market collapse is the relaxed mortgage and lending standards For instance the banks offer personal loans on easy terms to people who intend to purchase houses This pushes the price of properties up The end of a housing bubble and subprime mortgage makes a great loss to many financial institutions In situations like this the financial institutions have to reduce the amount of credit to their clients Therefore it may become difficult for individuals and companies to obtain loans for their businesses and other purposes This kind of situation is known as a credit crisis which means that there is little or no credit available for the customers This is critically examining that there is a rapid load growth as a result of greed as well as poor and foolish judgment on investment Bank CEOs do not oversee their task properly during the credit crisis They do not focus on the riskiness of the investment that satisfies their shareholders wealth Bankers earn more incentives as their benefits to increase the investments It will be argued that credit crisis mainly resulting from the bank chief executive officers CEOs incentiveAlan Blinder 2009a as cited in Fahlenbrach and Stulz 2010 attributes poor incentive schemes as the primary cause of the recent financial crisis The executive compensation was not properly linked with long-term performance Fahlenbrach and Stulz 2010 show that
@Kibin is a lifesaver for my essay right now!!
- Sandra Slivka, student @ UC Berkeley
Wow, this is the best essay help I've ever received!
- Camvu Pham, student @ U of M
If I'd known about @Kibin in college, I would have gotten much more sleep
- Jen Soust, alumni @ UCLA