Reason:

1. The financial crisis was caused by the subprime mortgage crisis in the United States. The subprime mortgage crisis refers to the shock, panic and crisis in the international financial market caused by the sharp increase in default and credit crunch in the American subprime mortgage industry in the summer of 27. Subprime mortgage refers to loans provided by some lending institutions to borrowers with poor credit and low income.

2. Fannie Mae and Freddie Mac, which used to account for 7% of the subprime mortgage market in the United States, are dominated by government agencies, and it is quite complicated to calculate the financial risks behind the securitization of loans. Usually, it is necessary to analyze the risks of similar loan cases in the past and calculate the principal and interest rate that investors can obtain. In the whole process, new market participants, for profit-seeking purposes, excessively pursue high-risk loans.

3. Due to the intervention of thousands of hedge funds, pension funds and other fund investors with high risk preference around the world, the original lending standards have become a dead letter in the face of high interest rates. Many small and medium-sized banks in the United States are willing to resell their mortgage claims because they don't want to wait for 2 years because of limited funds, and banks are also eager to lend money or they will be overwhelmed by interest expenses.

4. New market participants and Wall Street dealers constantly encourage lending institutions to try different loan types. Many lenders don't even require subprime borrowers to provide proof of financial qualifications, including tax forms. When evaluating the value of houses, lenders also rely more on mechanical computer programs than appraisers' conclusions, and the potential risks are buried deep in the subprime mortgage market.

5. As a result, all or most of the financial indicators of a country or several countries and regions deteriorate sharply, temporarily and super-periodically. The credit crunch that often follows is a situation in which the rapid growth of money demand is greater than the money supply. A few decades ago, the financial crisis was basically equivalent to a squeeze, but now it mostly appears in the form of a currency crisis. The stock market crash is sometimes a financial crisis.

Extended information:

The financial crisis is a crisis in the financial field. Because the liquidity of financial assets is very strong, finance is very international. The fuse of the financial crisis can be the financial products, markets and institutions of any country. ?

The financial crisis is characterized by people's expectation that the economy will be more pessimistic in the future. The currency value in the whole region has been greatly depreciated, the economic aggregate and scale have been greatly reduced, and economic growth has been hit, which is often accompanied by a large number of business closures, an increase in unemployment rate, a general economic depression in society, and sometimes even social unrest or national political turmoil.

reference link: financial crisis-Baidu encyclopedia