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Web of Proceedings - Francis Academic Press

An Analysis of the Us Economic Crisis of 2007

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DOI: 10.25236/iceesr.2021.068

Author(s)

Ming Su

Corresponding Author

Ming Su

Abstract

The economic crisis in the United States in 2007 has had a great impact on the world economy. With the influence of the overheated real estate market, the U.S. investment banks began to issue subprime loans, resulting in the occurrence of the subprime crisis, which eventually led to the collapse of the stock market. These have caused enormous economic damage to major developed countries and some developing countries. The damage stems from the massive investment in derivatives by financial institutions, the governments’ indifference and indulgence towards financial institutions, and the overwhelming enthusiasm of consumption due to the subprime mortgage crisis. This article adopts the method of literature induction to investigate the relationship between the U.S. government and major financial institutions, as well as to analyze the causes of the financial crisis and relevant remedies.

Keywords

Economic crisis, Subprime crisis, Law