The global credit crisis and worldwide recession was one of the worst economic disasters to happen in a very long time. It really was unprecedented in its size and scope. The events of the crisis pretty much took out every economy in the world, minus a very select few. And in dealing with the crisis, central bankers’ responses were unprecedented as well.
Interest rates were slashed, and even became negative in some instances; bond-buying programs were enacted; and fiscal stimulus measures were planned – all with the idea of igniting global growth.
With the crisis over and economic growth returning, many central banks have begun to pull back from their efforts. The question is, should they? There are two big issues facing the world’s economies that could derail growth in a big way.
Be sure to take a look into the last five recessions here.
The Need for Stimulus
The Great Recession and underlying credit crisis was unique in its vastness. A small cough turned into a flu of epic proportions as the linkages in the global economy started a huge chain reaction. As a result, the entire world plunged into a big mess. And in order to dig out of the hole, central banks in a variety of nations pulled out all the stops.