Take a research about what happened in 2008 Global Financial Crisis.

What was its cause and what do

you think should the industry do to avoid such happening again?

The 2008 Global Financial Crisis, also known as the great recession, was mainly caused by
failures in financial regulation. Back in time, the value of housing units had continued rising that banks
and other financial institutions allowed deregulation and lent out subprime mortgages. People, that had
hoped to acquire houses at a lower price that would increase their value over time also took risks in the
mortgage although those were accompanied by higher interest. Unfortunately, the housing bubble burst
where the prices of homes dropped. The borrowers also failed to pay which caused the foreclosure of
many properties caused the value of the houses to go down as well. Here, the banks and the borrowers
suffered an enormous loss, and other attributed events further damaged the economy.

The financial crisis struck foreign banks that were associated with the housing market in the
United States. The connection of the United States’ operation had led the problem to spread across the
globe. Other failures in financial firms triggered more panic and created more damage. Moreover, the
case was worsened by other factors which include an economic downturn.

In my judgment, it is important for us to not loosen up our regulations and protocols since
future events are unpredictable. Lend money to those who have good-credit than to take risk of
financial ruin. Taking high-risk might give higher returns but should be accompanied by wise decision
making and looking out for security.

Is there such thing as financial stability? Explain your answer.

From my standpoint, financial stability might be impossible because of the infinite possibilities.
Usually, people’s desires vary over time, and we look forward to acquiring more and something better.
High chances of searching for more things that we think we need. Other than that, there are factors that
individuals cannot see just like unforeseen economic and financial challenges. However, proper
financial management can probably at least take us closer to “financial stability” -part of it depends on a
person’s character. The term financial stability has no specific definition and inexistent since financial
status varies from one person to another, and there is no way it is fixed.

One must be sensible in taking care of money and use it wisely to have better security. Having to
borrow money does not particularly symbolize poverty, yet even large companies and establishments
acquire loans that will help their status that could be beneficial and essential in generating income. On
the other hand, having to ask for credit just for luxuries that are beyond one’s capacity to buy could be
unfavorable. Spending wisely, contentment, and having the feeling of satisfaction will not make us
financially stable but will instead lead us to financial security, which is concerned with having enough
resources to fulfill our needs.

What can be considered as factors that affect the financial management of the students?

Financial management is essential to students in the sense that it will make us more responsible.
Such practice shapes our spending habits in the future and teaches us to control money properly. In my
opinion, the factors that affect the financial management of the students include: First, the amount of
allowance, this brings maximum limit we can spend daily. Second, how students spend that reflects the
student’s lifestyle and knowledge of managing money. Third, unexpected school fees where students
might not have an extra budget on hand. Fourth, school events in which students tend to spend more.
Last, influence and trends affect the desire of the student to buy something interesting, and when
pursued by others to buy.