Financial turmoil, also known as financial crisis, refers to all or most of the financial indicators (such as: short-term interest rates, monetary assets, securities, real estate, land (prices), sharp, short-lived and super-cyclical deterioration in the number of business bankruptcies and financial institution failures.
The characteristics of the financial crisis are people's expectations that the future will be more pessimistic based on the economy. The currency value of the entire region has experienced a significant depreciation, the total economic volume and economic scale have suffered greater losses, and economic growth has been affected. blow. It is often accompanied by the collapse of a large number of companies, increased unemployment, general economic depression in society, and sometimes even social unrest or turmoil at the national political level. Financial crises can be divided into currency crises, debt crises, banking crises and other types. Financial crises in recent years have increasingly taken on some form of hybrid crisis. And it will gradually spread to surrounding cities and countries.
Extended information:
It has been five years since the financial crisis broke out in 2007. The best-performing assets during this period were precious metals and oil. , high-credibility country bonds and corn.
BNP Paribas froze three money market funds in August 2007 and suspended investor redemptions, triggering a credit crisis. In the following five years, investors withdrew their funds from risky assets and invested them in "entities" ” assets and safer bonds.
According to Deutsche Bank, gold’s investment return over the past five years has been as high as 143, and silver has been 121, becoming the main beneficiary asset. The returns on British, German, and US government bonds have also reached 54, 40, and 38 respectively. London Brent crude oil rose by 58% during the same period, and New York WTI crude oil also rose by 29%. But the return on investing in corn is as high as 144, surpassing gold.
Recently, investors have increased their investment positions in corn futures, causing corn to rise by 144% in the past five years, partly due to the recent drought in the United States. The U.S. Department of Agriculture estimated on the 10th that U.S. corn production this year will drop sharply by 13 to 10.779 billion buckets (273.8 million metric tons) compared with last year, the lowest in six years. This stimulated the December corn futures to trade at Chicago Futures on the 10th. Exchange (CBOT) rose 3.1 to $8.49 per British bucket, setting another record high.
Investment-grade and speculative-grade corporate bonds are also winners. Although corporate defaults increased sharply from 2008 to 2009, surprisingly few non-financial companies were hit hard by the financial crisis and economic recession, prompting investors to invest in the corporate bond market. Deutsche Bank pointed out that the return rate of U.S. investment-grade non-financial corporate bonds in the past five years was nearly 55%, and the return rate of European and American speculative-grade corporate bonds during the same period was approximately 40%.
In comparison, the stock market has performed poorly over the past five years. The British FTSE 100 Index returned more than 15%; the U.S. S&P 500 Index returned about 8%; investors in the Dow Jones EU 600 Index lost nearly 13%.
Baidu Encyclopedia-Financial Crisis