What did the article mean by another lehman moment

Assignment Help Microeconomics
Reference no: EM131023137

In the fall of 2011, investors began to fear that some European governments, particularly Greece and Italy, might default on the bonds they had issued, making the prices of the bonds fall sharply. Many European banks owned these bonds, and some investors worried that these banks might also be in financial trouble. An article in the Economist referred to the "prospect of another Lehman moment." The article noted that: "Governments are once again having to step in to support their banks." What did the article mean by another "Lehman moment"? Why might European governments have felt the need to support their banks to avoid another Lehman moment?

Reference no: EM131023137

Questions Cloud

Total value of investment : Briefly explain why the total value of saving in the economy must equal the total value of investment.
Financial intermediaries-provide risk sharing : How does the financial system-both financial markets and financial intermediaries-provide risk sharing, liquidity, and information to savers and borrowers?
How have cognitive models been used to understand the mind : What is a cognitive model, and how have cognitive models been used to understand the mind? Why are sensation and perception important topics to cognitive psychologists?
Did the fomc change the target for the federal funds rate : Did the FOMC change the target for the federal funds rate? If so, what was the change? On balance, in its statement does the FOMC appear to be more concerned about slow economic growth or high inflation?
What did the article mean by another lehman moment : An article in the Economist referred to the "prospect of another Lehman moment." The article noted that: "Governments are once again having to step in to support their banks." What did the article mean by another "Lehman moment"? Why might Europea..
What is a deeper pool of capital : An article in the Economist notes: That securitization caused more subprime mortgages to be written is not in doubt. By offering access to a much deeper pool of capital, securitization helped to bring down the cost of mortgages and made home-owner..
What is the total money supply : What is the total money supply? What is the equilibrium interest rate and What is the equilibrium level of national income
What is the machines net present value : Xavier Co. wants to purchase a machine for $36,800 with a four year life and a $1,000 salvage value. Xavier requires an 8% return on investment.
Important date in the history of india economy : a. Why is 1991 an important date in the history of India's economy? b. Why does India have a "tricky political climate"?

Reviews

Write a Review

Microeconomics Questions & Answers

  Explain the concept of externality in economics

Explain the concept of externality in economics? Give one example of a positive and a negative externality in Australia and what is Thorpe's marginal cost of GPA? Show and explain how his MC curve is derived.

  Do rights extend to businesses & other organizations aa well

The First Amendment to the U.S. Constitution added in 1891 as part of the Bill of Rights protects the rights of free speech, a free press, freedom to assemble or form groups and the freedom to contact and lobby government. Do you think that the ri..

  Use money just about every day

You use money just about every day. What is money and what functions does it perform? How is the supply of money measured? Who influences how much liquidity in created or reduced in the U.S. economy?

  How do financial intermediaries help mitigate liquidity

How do financial intermediaries help mitigate liquidity risk in the lending market?b.What is the market reaction to default risk in the case of US T-Bills as opposed to junk bonds?  Explain in terms of supply and demand?c. How can Congress create ris..

  How would cost fit into their explanations

Some psychologists see people's behavior as determined largely by family history and external environmental conditions. How would "cost" fit into their explanations?

  Firms marginal cost and marginal revenue functions

The Madison Corporation, a monopolist, receives a report from a consulting firm concluding that the demand function for its product is Q=78-2P+2Y+0.9A where Q= #of units sold, P=price of products in dollars, Y=per capita income and A = firms advertis..

  List and explain any 3 areas of sustainability of germany

Question: List and explain any 3 areas of Sustainability of Germany along with Birth rate and average life expectancy. Choose form Water, Environment, Infrastructure, Health care

  Define the moral hazard

Define the Moral hazard

  Fiscal policies such as the recent pay-roll tax cut

Fiscal policies such as the recent pay-roll tax cut, may result in all of the following, except

  Sam is interested in buying two types of goods

Microsoft Word - Problem Set 2 Questions 1.Sam is interested in buying two types of goods, x and y. He can either use all his income to buy 3 units of x and 9 units of y, or 9 units of x and 3 units of y. If he spends all his income on x, how many u..

  Explain relationship between slogan and firms elasticity

The Energizer Bunny that "keeps on going and going" has been a very successful ad campaign for batteries. Explain the relationship between this slogan and the firm's price elasticity of demand and total revenue.

  How an increased federal budget deficit

Explain how an increased federal budget deficit resulting from a recession can actually help stabilize an economy. Describe how adjustments in wages and prices take the economy from the short-run equilibrium to the long-run equilibrium

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd