It is true that cryptocurrencies have been gaining more acceptances all over the world. As a result, the rise of Bitcoin should have been no surprise had the rise been minimal. However, of late the value of a single Bitcoin has grown several-fold. It is now more valuable than several currencies in the world. The sudden and meteoric rise does raise some questions for the Bitcoin boom. In this article, we will understand the main reasons behind the sudden surge in the value of this cryptocurrency. The Recognition by Governments Most governments of the world have been in denial about the…
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The European economy is facing a significant downturn. There is a looming financial crisis in Europe which has been caused by excessive borrowing in the past. However, it is unlikely that this borrowing will stop in the near future. This is because the immigrant crisis in Europe is draining its resources making borrowing inevitable. In this dismal economic climate, Europe is likely to follow the path of devaluing the currency. The popular myth is that devaluing the currency gives a boost to exports and helps the overall economy grow. In this article, we will debunk this myth and find out why…
The dollar today is the uncrowned king of the financial world. This means that the dollar does not face much of competition from other currencies as on date. However, that does not mean that the dollar is invincible. Economies all over the world today are tired of the United States imposing its military and financial might on the rest of them. Efforts are therefore underway to topple the dollar. This is not the stated intention, but it is an important motivation behind the creation of BRICS bank and the Asian Infrastructure Investment Bank (AIIB). Even world bodies like IMF are…
Brexit was quoted as being the financial equivalent of doomsday for Britain’s economy. Every economic pundit worth his/her salt predicted dire consequences for Britain. Fear mongering was rampant, and memories from the Great Depression were invoked. However, a quarter into the Brexit all this has turned out to be mere propaganda. The Bank of England has come out of this test with flying colours. Not only is the British economy afloat, but it has also kicked into high gear with England defying the possibility of a recession and registering record growth. Doom and Gloom Predictions London was a major contributor…
The Mississippi bubble is one of the biggest asset bubbles known to the modern world. This bubble first led France out of bankruptcy and straight into prosperity. Then this same bubble caused the opposite to happen, bankrupted France and gave an impetus to the revolution. This bubble was created when John Law, a renegade Scotsman unleashed a fraudulent fiat banking system on an unsuspecting economy. Since the world had been on a gold standard, they were unaware of the devastation that fiat money could cause if it was left uncontrolled. In this article, we will cover the story of the…
Latvia is a small country nestles in Eastern Europe. Nothing from this country seemed remarkable to the global financial world before November 2008. After 2008, Latvia became a different story altogether. This small nation was also suffering from the crisis that rocked the world in 2008. The people lost billions of dollars, and some of the biggest banks failed. However, while the rest of the world resorted to bailouts, the Latvian government took a different path. The economies that used bailouts are on the brink of yet another collapse whereas the Latvian economy has withered the storm and is now…
Iceland is a small country with a population of about 300,000. Its economy is not considered to be significant enough to make headlines in the world financial news. However, in 2009, all this changed and Iceland became a talking point for economic experts all over the world. The way Iceland was handling its finances became a talking point in developed countries like the United States and the United Kingdom! Iceland was getting all this attention because the unique policy that it had adopted while dealing with its recent financial crisis. Like many other countries in the world, the economy of…
The Nordic crisis of 1992 refers to the series of bank runs and currency crisis that shook Finland, Sweden as well as Norway in the early 1990’s. This was the first major national banking crisis since the 1930’s (if wars are not taken into account). Thus, an important belief that the fractional reserve banking system has been stabilized all over the world, has been challenged and shaken to the core. In this article, we will understand the factors that led to the crisis as well as the repercussions of the crisis. Increased Fragility The period immediately preceding the crisis saw…
The Israeli bank crisis of 1983 rocked the Middle Eastern financial world. The Israeli economy was believed to be strong and has been able to navigate many wars since its inception in 1948 without breaking down. However, in 1983, the economy faced major shocks even in the absence of any major war or political upheaval. In this article, we will have a closer look at the factors that caused this economic upheaval as well as how the Israeli government resolved it. Hyperinflation During the early 1980’s the Israel economy started experiencing extreme hyperinflation. The economy had gone from a 13% inflation…
The high indebtedness of the United States of America is well known. However, USA is still considered to be an economic superpower and its economy even in the faltering state is better than many countries. However, of late Puerto Rico, an American state in the Caribbean islands has revealed information that communicates financial distress. The Puerto Rican governor Alejandro Garcia Padilla has told the media that the $72 billion accumulated by the Puerto Rican government as debt is simply not payable. He goes on to state that the Puerto Rican debt crisis is not a political problem. Rather it is…
