dear soul

The global financial crisis, brewing for a while, really started to show its effects in the middle of 2007 and into 2008. Around the 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.

On the one hand many people are concerned that those responsible for the financial problems are the ones being bailed out, while on the other hand, a global financial meltdown will affect the livelihoods of almost everyone in an increasingly inter-connected world. The problem could have been avoided, if ideologues supporting the current economics models weren’t so vocal, influential and inconsiderate of others’ viewpoints and concerns.

This article provides an overview of the crisis with links for further, more detailed, coverage at the end.

This web page has the following sub-sections:
A crisis so severe, the world financial system is affectedSecuritization and the subprime crisis
Creating more risk by trying to manage risk

• Almost half the world — over 3 billion people — live on less than $2.50 a day.
• The GDP (Gross Domestic Product) of the 41 Heavily Indebted Poor Countries (567 million people) is less than the wealth of the world’s 7 richest people combined.
• Nearly a billion people entered the 21st century unable to read a book or sign their names.
• Less than one per cent of what the world spent every year on weapons was needed to put every child into school by the year 2000 and yet it didn’t happen.
• 1 billion children live in poverty (1 in 2 children in the world). 640 million live without adequate shelter, 400 million have no access to safe water, 270 million have no access to health services. 10.6 million died in 2003 before they reached the age of 5 (or roughly 29,000 children per day).

how we salve all this crisus

As mentioned above, Mahavira'a economics can be understood through some of his basic teachings. According to Mahavira, insatiable ambition and place can never be reconciled. We do need economic resources but the 'principles of economics' should conform with the 'economics of peace'.

Hence man should practice restraints and abnegation rather than falling prey to or being tempted by consumerism,luxury or comforts.One should not be mislead by the above sentence regarding Mahavira's principles. Although he stressed on abstinence and asceticism,he also understands the 'need' for resources in the pragmatic life. All he demands is that we should balance the materialistic lifestyle with self-restraint,wherever possible. Therefore he is not against the needs of a man for existence but against the 'needs' of luxury and comfort. As we all know that human wants are insatiable but the needs for a living are not. Hence a balance between principles of limitation and relative principle of modern economics will give us a deeper understanding behind Mahavira's philosophies

A crisis so severe, the world financial system is affected

Following a period of economic boom, a financial bubble—global in scope—has now burst