Global financial crisis conversation questions

From Teflpedia

Credit Crunch[edit | edit source]

  • Who do you think is most responsible for the credit crunch?
    • The banks
    • George Bush
    • Alan Greenspan
    • Angela Merkel
    • Somebody else
  • Do you think that some companies should be "bailed out" (given money) by governments? Under what circumstances should this happen?
  • Some companies (and banks) are called "too big to fail." What do you understand by this?
  • Some say that if a company (or bank) is "too big to fail" it is also "too big to exist", and should be broken up into smaller units. What is your opinion?
  • One of the main reasons for the existing crisis is the fact that cheap money was pumped into the economy. Governments have responded by reducing interest rates even further and by trying to persuade banks to lend more money. What is your opinion of this policy?
  • Governments have invented ways of simply creating money to fight the crisis and increase the quantity of money in the system. What do you think the consequences of this will be?
  • Instead of the well-known problem of inflation (where prices increase), during the crisis some countries faced deflation (where prices fall). Why should falling prices be a problem?
  • House prices are now falling in many parts of the world. What are the advantages and disadvantages of this?
  • Is it the government’s obligation to try to maintain full employment in their countries?
  • Which problem should governments be most concerned about - unemployment or inflation? What actions can they take to control these two problems?
  • Stock markets have performed very badly during the crisis. What difference, if any, do you think that makes to average people?
  • Before the crisis, rating agencies (Standard & Poor’s, Moody’s, and Fitch) claimed that all the investments which turned out to be bad were "high quality". Now the agencies are downgrading countries saying they may not be able to pay their debts. What is your opinion of the rating agencies?
  • What financial alternatives do people have available when money weakens as an exchange mechanism? Gold? Silver? Are these viable alternatives?

Banks and the crisis[edit | edit source]

  • Many people feel that the recent global crisis was caused by the banks - who then, for some reason, had to be bailed out with taxpayers' money. As a consequence of these bailouts some banks made enormous profits. How do you feel about the fact that many bankers then paid themselves themselves huge bonuses as a consequence of these enormous profits?
  • As consequence of the crisis many people have lost their jobs are now unable to pay the money lent to them by the banks. In theses cases the banks repossess the houses in order to recover part of the debt. What do you think of this practice?
  • If banks were unable to repossess people’s houses then it is possible that more people would stop paying for their mortgages. What effect would this have on the banks' finances?
  • If people in general come to believe that banks have insufficient money then they may all decide to withdraw their money from the banks. What effect would this have?

See also[edit | edit source]