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Video: John Authers looks at how the financial crisis has resulted in significant pain to the world economy
The Big Freeze
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What happens now?
It is a year since the European Central Bank was forced to inject €95bn into the eurozone banking system, bringing home what many had suspected – that the fallout from the US subprime mortgage crisis in the US was causing serious pain to global financial markets.
The fallout has been dramatic. Across the world, banks have been forced to raise fresh capital to repair ravaged balance sheets. Several have gone bust or have had to be bailed out, and thousands of jobs have been cut.
The fallout from the crisis has not been confined to the financial sector. The effect on the wider economy, against a backdrop of collapsing house prices, slowing growth and rising inflation, has been profound.
In this series, the Financial Times looks at how the world has changed in the past 12 months and the long-term impact on the global financial system and the world economy.
Related content and features
Video
The credit crunch, crunched
A Year in a Tin Hat: The most dramatic events of the past 12 months, narrated by FT Alphaville’s Paul Murphy
FT series
Big Freeze part 4: A US recovery
There is much scope in the current climate for fiscal measures to boost demand, while for the financial sector capital not liquidity is the priority, writes Lawrence Summers
Big Freeze part 2: Banking
Investment banks already struggling with weakened balance sheets as a result of the credit crunch may find their most profitable activities curbed
Big Freeze part 3: The economy
Central banks caught between the risks of recession and runaway inflation are pursuing policies that make little sense in aggregate
Big Freeze part 1: How it began
The FT examines the reasons for the credit crisis – which began in the US suburbs and overturned the assumptions of bankers
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