How Three Years of Economic Vandalism have Led Global Finance to Triple

Introduction

There is only one logical explanation that can describe the present global economic crisis. To find out how the system really turned into a global money making bonanza many utilize online resources, but going back three years is just not enough. This article is going to spread some light on the economic crisis of the past three years but more importantly on how and when this financial circus came to town in the first place.

Peace, Policies and Political action

Well, these three can just about sum up what went wrong in the past three years in terms of business problems, economic problems and the business cycle, with the wars in Afghanistan and Iraq, and civil war breaking out in most parts of the world totally disrupting the global economic situation. Bad economic policies coming in a close second when it came to making the right choices and of course the political instability in America which did not help the financial crisis at all and saw many of the European countries also, following down the same road to austerity.

A History Behind the Math Meltdown

It is important to realize that in America, every decade from the 1920’s onwards has seen a rising level of wages. It was understood by the people that having employment would allow a person to go out and purchase that which they needed.
It is also important to notice that this phenomenon started to slow down by the 80’s.

Real wage of employees stopped since then and have not resumed ever since. The business community, on the other hand, has experienced a fantastic last thirty years or so.

In terms of productivity, the past thirty years saw a splendid rise in labor productivity. But here’s the catch, each year the average employee produced more, their salaries remained the same. As the size of the gap increased so did the profits and that eventually lead to the financial fiasco we are in today. To dig deeper for more info many utilize online resources.

The past thirty years where employees experienced flat wages are the years where big corporations and multinational businesses witnessed the highest profits not just in America but globally. What all this profit gaining led to was the increase in bonuses and level of other perks given to top executives that no one had ever heard of.

The following years saw big companies buying other smaller companies and paying their staff huge sums of money in the form of bonuses and annual salaries. To add fuel to the fire, these large corporations put their profits in the banks. It was that time when the large companies and banks saw a new profitable way to increase their new found wealth, they borrowed it to their employees.

That was the only possible way of making employees raise their rate of consumption while keeping their wages at the same level. This point is very important and is sometimes under-estimated by many people who wonder how the global economy has reached where it stands today.

Companies found a way of how to give money to their employees as loans, which would have to be paid back (with interest) instead of just raising the employee’s wages. The bottom line is, it’s so easy to push debt on the public that everybody does it. It was the perfect way to make the market consume on credit, and at the bottom of all that borrowing lies the sub-prime mortgage which has bit a huge chunk out of the American and in turn the global economy.

Thanks to the internet, there is lots of detailed information for many of those who need credit help, many utilize online resources to find what they are looking for to increase their odds in the current financial disaster.

Conclusion

What we have witnessed in recent times is not who created this mess, but how Wall Street has responded to the current financial crisis. To make it worse, banking institutions lent more money out to people, further increasing the global debt. This is how overweening greed has squeezed every penny out of the working class. Looking at it from a global prospective, the three necessary solutions out of this mess are base-line cuts, decreasing foreign expenditure and less militarism.

Author’s Bio

Angelina is a writer and a community manager at Consolidated Credit who enjoys analyzing the global economic situation and frequently writes about ways of getting information and certain steps that can be utilized by people who are in an economic crisis such as many utilize online resources to gather information that can be useful to them later on.

Angelina Jennifer

Angelina is a financial adviser and writes several blogs about personal finance management. she has years of experience working with companies like Consolidated Credit, helping people with their debt problems. More From Angelina Jennifer »

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    • Rajandran is a Market Analyst and founder of Marketcalls, one of the most intelligent blog in the world to share knowledge on Technical Analysis, Trading systems & Trading strategies.