 On Sept. 15, 2008, Lehman Brothers filed for bankruptcy.

 With $639 billion in assets and $619 billion in debt, Lehman's

bankruptcy filing was the largest in history, as its assets far
surpassed those of previous bankrupt giants such
as WorldCom and Enron. Lehman was the fourth-largest U.S.
investment bank at the time of its collapse, with 25,000
employees worldwide.
 Lehman's demise also made it the largest victim of the U.S.
subprime mortgage-induced financial crisis that swept through
global financial markets in 2008
Financial crisis is an economic situation in which the economy of a
country faces some unanticipated downturn or recession, price
fluctuations, current account deficits and uncertainty on foreign sector.
Or
The term financial crisis refers broadly to a variety of situations in which
some financial institutions or assets suddenly lose a large part of their
value.
The financial crisis of 2007–2008, also known as the global financial crisis
and the 2008 financial crisis, was a severe worldwide economic crisis
considered by many economists to have been the most serious financial
crisis since the Great Depression of the 1930s,
 There were three causes of the 2008 financial crisis:
1. Deregulation,
2. Securitization and
3. Poor timing in lowering and raising interest rates.
 For example, a downward drift in the housing market of the
United States, risky practices regarding lending and borrowing,
and excessive individual and corporate debt levels have caused
multiple adverse effects on the global economy.
 All these years, it has passed through various stages exposing
persistent weaknesses in the world financial system and
regulatory framework.
 The major reason behind the crisis was an increase in loan
incentives such as easy initial terms, along with the trend of
rising housing prices that encouraged borrowers. As a result,
people could easily enter into difficult mortgages.
 In 2006-2007, however, the rising interest rates and declining
housing prices in many parts of the U.S. made refinancing more
difficult.
 Collapse of major investment banks in 2008.
 The financial crisis triggered a global economic recession that
resulted in:
1. more than $4.1 trillion in losses,
2. unemployment rates that climbed to more than 10 percent in the United
States and higher elsewhere, and
3. increased poverty.
4. Stock markets around the world crashed.
5. Manufacturing declined sharply
Far away from the U.S. and Europe, Pakistan has suffered from:
1. high fiscal and current account deficits,
2. rapid inflation,
3. low reserves,
4. Unemployment,
5. a weak currency and a declining economy that have put the country in a very
difficult situation
6. political instability and poor law and order situation.

These factors created a perilous environment for economic growth.

Furthermore, a weak institutional base and the inability of successive
governments to undertake long-term and broad-based reforms and policies
have made sustained economic growth difficult. Therefore, Pakistan’s
economy was already in a dire situation well before the current financial
crisis hit the developed countries.
 The huge unemployment will result in diminished purchasing
power of the people in these countries, which will surely affect
exports from all the countries including Pakistan.