Switzerland is very famous for its banking system. It is providing the best destination for international clients for many reasons. They provide many facilities to their costumers and also provide good opportunities to their costumers. Following are five reasons that why Swiss banks are famous all over the world.

Political stability in Switzerland

Switzerland is the most stable country in the world as it has not been at war with any other country since 1505. The government of Switzerland is not facing the problems, what other under developed countries are facing. The political conditions are stable in this country.

Safe banking in Switzerland

Swiss banks are very safe to deposit your money. There security system is very strong with strong management. There is no chance of losing your money if you deposit them in Swiss banks. So deposit your money with out any fear of losing that money.

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On Friday the Federal Reserve has made plans for buying agency mortgage debt maturing between December 2010 and November 2011.

When will the Purchases Begin?

The purchases would start to begin from 10:30 a.m. EST. It has been pointed out by Wrightson ICAP analysts that the central bank has reached its self-imposed 50% limit of total holdings of the Fannie Mae (FNM) 1.75% notes due Mar. 23, 2011.

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The World Bank published a report today in The Financial Times, saying that rapid interest rate increases aimed at surrounding inflation in product and asset prices, could give way to another recession in US and European countries, as their economies are recovering quite slowly.

The World Bank President, Robert Zoellick, said in the report that waiting for bubbles to burst and then cleaning up the aftermath is now a new lesson of what not to do.

According to him, the interest rates, tightened too much could lead to another downturn, especially in the case of countries that are showing weak recovery signs.

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It might be unbelievable for many, but the Federal Reserve Bank has actually succeeded in making profit from the financial crisis.

The Fed has had $14 billion as profits made on loans disbursed in the past two years, according to an internal estimate obtained by the Financial Times.

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The Fed’s board of governors asked the Manhattan Chief U.S. District Judge, Loretta Preska, to delay the enforcement of her decision, which she took on 24^th August about the identities of borrowers.

The decision required that the identities of borrowers in 11 lending programs must be made public by Aug. 31. Until the U.S. Court of Appeals in New York can hear the case, until the U.S. Court of Appeals in New York can hear the case, the central bank wants Preska to stay her order.

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The Federal Reserve has been asked by the investors, for loans making an amount of $2.3 billion, against commercial-mortgage-backed securities created before this year, an expansion from $668.9 million in its financing program.

According to the New York Fed, the central bank got no requests for newly issued bonds backed by loans on skyscrapers, shopping malls, apartments or hotels. That part of the Term Asset-Backed Securities Loan Facility, or TALF, hasn’t been used since its start three months ago.

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According to the central bank and government studies, the US demand for loans fell in the second quarter for every major category bar prime residential mortgages due to tightened credit standards set by the banks making the borrowers cautious.

The US Federal Reserve observed in its quarterly survey of senior loan officers, conducted between July 14 and July 28, that the percentage of banks that tightened loan standards for business and households was slightly lower than in the first quarter.

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If we look into history of different countries we will find that different countries faced the financial crises at different times. As the world is facing now financial crisis now also, the question comes in mind that who are those who run this finance horse, what are the reasons which leads to financial crises? Or is there is someone who is holding all the strings and keep them pulling? So many questions come in mind when mind starts thinking about it.

Well I had searched about this and compiled these ten nasty crises. Check out these ten dramatic crises.

1 – Argentine economic crisis (1999 – 2002)

Argentinean economy was destabilized in 1980s when Latin American Crisis struck it. Argentine was an import dependent country where people usually convert their peso into dollars to feel secure. The high inflation rate leads its currency to lose the confidence and adding oil to fire the government that time spent generously on itself while ignoring the country’s crumbling industrial infrastructure.

Mexico and Brazil were the major trade partners of the Argentine in 1980s both countries suffered the economic crises which spread out in Latin America. Brazil’s currency was devalued in 1999 that damaged a lot Argentinean exports and adding fuel to fire the dollar was revalued giving a harsh blow to Argentinean Peso.

Till 1999 the country was having 3^rd consistent year of economic decline but the government haven’t devalued the peso, which made the crisis worse. In such conditions the investors ran on banks for dollars to send abroad for safety. Meanwhile the government freezes everyone’s bank accounts. This step of the government raised violence amongst citizens and protests through out country were started. The government was collapsed in 2001. While in crisis the people were bartering for goods because lack of cash, many people eked out a living by scavenging cardboard for recycling plants.

The new government 1^st tried to setup a third currency between dollar and peso but that failed. Then it instructed the banks to convert all dollars into pesos. That step worked and peso was lead to diminish in value. Because of that exports got higher and in meanwhile the government tightened its tax policies, improves social welfare, encourages business growth and put the reserve dollars up for sale in market. The country got the surplus trade because of its agricultural products anyhow its still struggling with inflation.

Lesson

Freezing bank accounts leads the crises to get worst. It can’t be a smart step to tackle the crisis.

2 – Russian Financial Crisis (1998)

The Russian government in 1993 introduced inflation-free short-term treasury bills known as GKOs to finance the country’s deficit. GKOs were traded on currency exchanges. Most of it was state owning while only 1/3 of funding came from foreign speculators who were attracted by high interest rates. Like a classic Ponzi scheme the government used proceeds from sales of new GKOs to payoff interest on matured bills.

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These myths have been made popular in the mainstream mainly by Keynesian economists trying to influence public policy.

Myth No. 1: The Key Element of Economy is Consumption

Consumption is, in reality, important in a free economy: especially the freedom of consumers to buy goods in unrestricted markets. However, it is investment (savings) – the total opposite of consumption – that holds the key to long term economic growth.

Consumption-promoting public policies, like low interest rates, do so at the expense of savings. Fewer saving means less investment; and an economy that consumes all its resources without saving or investing, will eventually end up bankrupt.

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