There is a Interesting topic now a days almost all people are discussing and because it has affected our life to some extent all people made certain assumption about it , the topic is not other then Global recession, i just want to share my views on the same.
Global Meltdown- Subprime Crisis.
The global financial system have divided the masses as per there financial status and there previous behaviour in repaying any type of credit
as Prime borrower and sub prime borrower, the prime borrower have better financial status and good record of repaying any credit then subprime
borrower. The Global banks started giving Loans to sub prime customers on higher rate to take more revenue on security of the property That is
Real estate(house), because of more Real property and less demand in global market the property prices dips down and suprime borrowers started
Defaulting the loan and banks started selling the property this again increases the demand and pushes the price down further ,
Because of that there are more defaults of loan occurs.
banks are not the only financial institution which lost money in this situation becuse they already have sold some part of it to investment bankers
and they also have taken insurance on the loan, that's why it affected the whole financial institution all over the globe, Thanks to RBI(Reserve bank
of India) conservative and extreme regulations that has restricted our Nationalised banks to invest in that global securities, otherwise our position is
also like American and British financial system.
We have not get hurt as America, but yes we have also affected to some extent because of less demand of software from global financial market.
Foreign Institutional investors have also take there money out from our market only because they dont have funds to run there organisation not
because of any fundamental reason, this all phenomena has let to meltdown of stock market of india from 21000 to 7000(BSE SENSEX), this
has affected Mutual fund houses and insurance sector most.
Believe me now the market is reviving, and i find myself fortunate that i have seen such a condition and have seen persons making good money
By investing systematically, its really a lifetime experience for any person who is in financial market.
truly said aman...the subprime crisis has of course rid a lot of wealth of the world in general and america in particular...but india has begun its revival the least affected..
ReplyDelete& when U talk of being fortunate,i'd also not hesitate in agreeing that even i too am a fortunate to see this slump & rise and get a better idea of market dynamics.!!
good aman,
ReplyDeleteyou have rightly putted your point about sub prime crisis.AS u have said that market is reviving and you are fortunate about the market.
I hope we will get the good results in near future.