There are several factors that caused the global financial crisis happened in 2008. First of all, it was started by a new banking system called Securitisation. This system allowed the banks to turn their various loans into sellable assets, such as mortgage. Unfortunately, this new management system was running without the right control and management. As a result, this condition leads to financial burst. In other words, when the price of the houses declining, so did the investment, loans, and other loans of the banks. This, again, caused difficulties for other people, such as the business people, to get bank loan. Furthermore, beside its misused of the Securitization system, the bankers, hedge funds, and others was too confident in interpreting the system of Securitisation. They thought that they already spread all the risks effectively. However, when it went wrong, it all went wrong which caused the 2008 global financial crisis. At the end, this global financial crisis forced the government to help those banks from collapse through bail-out. In conclusion, the 2008 global financial crisis began when the banks, hedge funds, and others false in interpreting the Securitization system.
