Following a period of economic boom, a financial bubble—global in scope—burst and began to show its effects in the middle of 2008. Since then, world stock markets have fallen, large financial institutions have collapsed or been bought out, and governments in even the wealthiest nations have had to come up with rescue packages to bail out their financial systems.
Many people are concerned that a global financial meltdown will affect the livelihoods of almost everyone in an increasingly inter-connected world. Some say the problem could have been avoided, if ideologues supporting the current economic models weren’t so vocal, influential and inconsiderate of others’ viewpoints and concerns.
Most economic regions are now facing recession or are in one. At such times governments attempt to stimulate the economy by techniques such as increasing borrowing, reducing interest rates, and reducing taxes and spending on public works such as infrastructure. Borrowing at a time of recession seems risky, but the idea is that this should be complimented with paying back during times of growth.
Internationally, many people are now calling for fundamental reforms of financial systems. This includes international banking and finance, the reform of international financial institutions, and giving more voice and power to poor countries which typically have little say in how the global economy is shaped.
economic boom - a sudden increase in trade and economic activity
buy (bought) out - to pay money for somebody to be freed from a contract or debt
rescue packages - steps which will save state/company from a difficult financial situation
financial meltdown – when economy becomes weaker in a sudden and dramatic way
recession – when an economy is experiencing less trade and industrial activity
public works – building work such as that of hospitals, schools, or roads, which is paid for by government
TIME FOR IDIOMS:
boom and bust – a feature of an economic system or an industry where a period of success and wealth is followed by a period of difficulty
go public – (about a company) to start selling shares on the stock exchange