“Current happenings on the world capital market, leading to a hyped credit crunch”!

US recession- root cause for present financial instability and economic slowdown in the world economy. .

The US recession has, caused a flood of cheap credit in the world capitalist economy. This has fuelled the frenetic speculation and has led to an imbalance and contradictions in the world economy. Each day brings an extraordinary opening in the financial scenario that may have sounded astonishing just the previous day. The financial crunch has resulted in the virtual disappearance of major financial institutions overnight.
Job losses and unemployment tolls have skyrocketed. The US recession, hunkered down since September last year is still showing no signs of rebounding not even anytime in the near future. This has resulted in a downturn in the banking sector, causing a situation of financial crisis.

Running the financial system smoothly in any recession is intricate, but managing through the current one is especially difficult as it is set apart from all the previous recessions in a number of ways. One of the issues requiring an immediate solution is the plunging in employment deepening further. This has caused a deleveraging not only for the customers but even companies too and that too on a massive scale as never seen before.

It’s hard to be buoyant in the present recession, but consider it a prospect! Marathoners and racers often comment that the hardest part of the race is the uphill stage, where actually the leads get changed. So, when the recession ends the financial road will again level-off. An optimistic approach, focus and firm believe will surely let the world out of this credit crunch.