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US Causes Global Crisis

US Causes Global Crisis. Objectives. Explore events leading up to financial crisis that struck the US and the world in 2008. Interpret political cartoons relating to global economic crisis. Consider the connections between globalization and the current economic crisis. Warm Up.

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US Causes Global Crisis

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  1. US Causes Global Crisis

  2. Objectives • Explore events leading up to financial crisis that struck the US and the world in 2008. • Interpret political cartoons relating to global economic crisis. • Consider the connections between globalization and the current economic crisis.

  3. Warm Up • What have we learned about globalization so far? • Cultural, economic, political? • Effects on people? • Benefits? • Downsides?

  4. Sub-Prime Mortgage crisis • Listen to NPR report “Global Pool of Money Got Too Hungry” and complete guided listening worksheet • http://www.npr.org/player/v2/mediaPlayer.html?action=1&t=1&islist=false&id=90327686&m=90327669 • http://www.choices.edu/resources/documents/organizer_008.pdf • Global Pool of Money? • Mortgage Loans? • Foreclosures? • Too Big To Fail Explains It All • Rap Version of Event

  5. Domestic Fallout? • Housing Prices Decline • Foreclosures • Rising Unemployment • Loss retirement/pension • Auto industry decline • Investors withdraw from stock market, move to commodities • Further tumble in stock values • Banking Crisis • Bank & Lending House failures (write off losses) • Bear Sterns & Lehman Bros bankruptcy (no $ to cover) – AIG on verge • Govt Bailout • TARP - Up to $700 b in distressed assets • Stability, confidence, reform http://youtu.be/wVV6dzDOgQ0

  6. Political cartoons • In order to analyze the global impact of the crisis, we are going to work in small groups to evaluate a series of political cartoons. Labels: Identify or name certain things in their cartoons so that it is apparent what the things represent. Symbolism: Use simple objects to represent larger ideas or concepts. Analogy: Compare a simple image or concept to a more complex situation, in order to help the viewer understand the more complex situation in a different way. Irony: Highlighting the difference between the way things are and the way the cartoonist thinks they ought to be.

  7. Main ideas • Economies are so interconnected that failure of bullish US economy led to a series of global events. • US economy has the power to destroy the entire global economy. • With collapse of US economy, China remains as leading power. Global panic when their market shows slight weakness. • In the end, the US public will pay for Wall St errors in one way or another (higher taxes, or increased price consumer goods)

  8. Closure • How is the current economic crisis related to globalization? • Money is global – invested all over • Economies slow as credit tightened, internatl trade declines • Drop in US demand hurts rising economies • Loss investor confidence hurts global markets • Lower interest rates = weaker dollar = declining profits for trade partners

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