Current global financial crisis: the great recession and the nascent recovery

Extract: The global financial crisis of 2007-09 will go down in the history indubitably as the foremost economic and financial cataclysm of the twenty-first century, a seismic economic and financial event. It also acquired the dubious distinction of being the gravest crisis since the Great Depression, adversely affecting both the financial and real sectors of the global economy. Banking and financial system in the advanced industrial economies was the epicenter of this crisis, which was driven close to a collapse. Soon it had dismal consequences for the global economy. Crises of this dimension transpire once or twice in a century. The contemporary phase of financial globalization was progressing at a commendable pace until the crisis interrupted. According to the McKinsey Global Institute (MGI, 2009), financial assets in the international markets, which included equities, private and public debt and bank deposits, had increased almost four-fold during the 1980 and 2007 period. The crisis brusquely stopped three decades of expansion in the international financial markets.