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Global Financial Crisis

Global Financial Crisis . Deepak Prakash Bhatt, PhD. Criticism . Joseph E. Stiglitz - Senior Vice-President of WB Chairperson of Council of Economic Advisors Raised discontents about world bank policies Critical views about globalization, free market fundamentalists and IMF

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Global Financial Crisis

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  1. Global Financial Crisis Deepak Prakash Bhatt, PhD

  2. Criticism • Joseph E. Stiglitz- Senior Vice-President of WB • Chairperson of Council of Economic Advisors • Raised discontents about world bank policies • Critical views about globalization, free market fundamentalists and IMF • Recipient of the Nobel Memorial Prize in Economic Sciences-2001

  3. …. • Price of Inequality: How Today’s Divided Society Endangers our Future • Higher taxes on rich • Millions are poor so that reduce the corporate welfare • Freefall: Free Markets and Sinking of the Global Economy • Take lessons form Asian Crisis of 90’s • Need sense of balance between market and the state, between individualism and community and man and nature

  4. …. • The Three Trillion Dollar War: The True Cost of Iraq Conflict • The war highly expensive than budget 50 bil. allocated by White House • Human death tolls are not accounted • Stability with Growth: Macroeconomics, Liberalization and Development

  5. Global Financial Crisis • Started to show its effects in the middle of 2007 and into 2008 • Also known as the Global Financial Crisis-considered by many economists the worst financial crisissince the Great Depressionof the 1930s • It resulted in the threat of total collapse of large financial institutions, the bailoutof banks by national governments, and downturns in stock markets around the world • In many areas, the housing market also suffered, resulting in evictions, foreclosuresand prolonged unemployment

  6. …. • The crisis played a significant role in the failure of key businesses, declines in consumer wealth estimated in trillions of U.S. dollars • Downturn in economic activity leading to the 2012 • World stock markets have fallen • Large financial institutions have collapsed or been bought out • Nations have had to come up with rescue packages to bail out their financial systems

  7. …. • Following a period of economic boom, a financial bubble—global in scope—burst • A collapse of the US sub-prime mortgage or credit quality of market • Reversal of the housing boom in other industrial-ized economies have had a ripple effect around the world • Weaknesses in the global financial system have surfaced

  8. …. • Some financial products and instruments have become so complex and twisted • Role of the rating agencies • Loans were seen as security-Securitization • Subprime Mortgage Collapsed because of interlinked investments

  9. …. • The bursting of the U.S. housing bubble • Peaked in 2006caused the values of securitiestied to U.S. real estate pricing • The financial crisis was triggered by a complex interplay of policies that encouraged home ownership, providing easier access to loans • Lack of adequate capital holdings from banks and insurance companies

  10. …. • Theory-housing prices would continue to escalate • Questionable trading practices on behalf of both buyers and sellers • Compensation structures that prioritize short-term deal flow over long-term value creation

  11. International Security • Traditional Approach-State centric and military concerns • International security consists of the measures taken by nations and Intl orgs to ensure survival and security through military action and diplomatic agreements • Balance of Power • Interlinked-Intl and national security • End of WWII-emerge as sub-field of IR-Peace, Security and Strategic Studies

  12. …. • State-centric notion of security has been challenged by more holistic approaches to security • Basic threats to human safety are paradigms that include- • Cooperative Security • Comprehensive Security • Collective Security • Human Security

  13. …. • Walter Lippmann • Arnold Wolfers • Barry Buzan • Mahbub-ulHaq • Nayef Al-Rodhan

  14. Newer Dimensions • Zero sum to multi sum security • Global security • Human Security • Environmental Security • National Security • Transnational Security • Transcultural security • Global security and the security of any state or culture cannot be achieved without good governance at all levels that guarantees security through justice for all individuals, states, and cultures

  15. Environmental Problems; Climate Change and its Implication • Significant and lasting change in the weather patterns over periods ranging from decades to millions of years • It may be a change in average weather conditions • In the distribution of weather around the average conditions

  16. …. • Factors- • Biotic processes-living things that shapes ecosystem • Variations in solar radiation received by Earth • Plate tectonics- large scale motions of earth • Volcanic eruptions-leaves gases • Ocean Variability-seafloor spreading • ‘Sun’ is the predominant source for energyinput to the Earth • Both long- and short-term variations in solar intensity • Certain human activities have also been identified as significant causes of recent climate change, often referred to as global warming

  17. Environmental Security • Important field of international relations and international development • Threats by environmental events and trends to individuals, communities, international institutions or organizations or nations • Focus on the impact of human conflictand IR on the environment, or on how environmental problems cross stateborders

  18. …. • Environmental security – • Preventing or responding to environmentally caused conflicts • Preventing or repairing military damage to the environment • Protecting the environment due to its inherent moral value • It considers the abilities of individuals, communities or nations to cope with environmental riskschanges or conflicts, or limited natural resources

  19. …. • Copenhagen School-regional, global and securitization • Relationship between security concerns such as armed conflict and the natural environment • Human activity impacts- CO2 emissions • Regional and global climatic changes in agricultural output • Food shortage-political debate, ethnic tension and civil unrest

  20. International Development • ID projects may aim to improve aspects of environmental security-food or water security • MDG 7 about environmental sustainability show international priorities for environmental security • Security of fisherieson which many people depend for food

  21. …. • This energy is distributed around the globe by • Winds • Nuclear • Coal • Water • Ocean currents • Fossil • Thermal • Petroleum • Changes in greenhouse gas concentrations

  22. …. • Factors that can shape climate are called climate forcing or "forcing mechanisms” • These include processes such as variations in solar radiation, variations in the Earth's orbit, mountain-buildingand continental driftand changes in greenhouse gas concentrations • There are a variety of climate change feedbacksthat can either amplify or diminish the initial forcing

  23. Books • Security and Climate Change: International Relations and the Limits of Realism by Mark Lacy, Routledge (2007) • A Political Theory of Climate Change by Michael S. Northcott, Wm. B. Eerdmans Publishing (2013) • Climate Cataclysm: The Foreign Policy and National Security Implication of Climate Change by Kurt M. Campbell, Brookings Institution Press (2008) • The Climate Crisis: An Introductory Guide to Climate Change by David Archer, Stefan Rahmstorf, Cambridege University Press (2010) • Climate Change: Picturing the science by Gavin Schmidt, Joshuna Wolfe, Jeffrey D. Sachs, W.W. Norton & Company (2009) • Climate Change: What the Science Tells Us by Charles Fletcher, Wiley (2013)

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