Effects of the US Economic Meltdown on France

Bank failures, reduction in total production, unemployment, and overall poverty was the basic characteristics. The impact of this great depression was different in different countries. Most of the French invested in gold at that time. Less exposure to the stock market gave France the opportunity of less exposure to stock market-related risk. Many French companies were locally funded. This makes their performance less volatile than those of the US companies. Although the relative intricacy varied, the great depression brought a shock to the French economy. http://jch.sagepub.com/cgi/pdf_extract/4/4/21
The present financial crisis has its source in the United States. The amazing similarity between these two depressions is the failure of regulation. Either the regulation was absent, or it was not strong enough to protect its objectives from the possible misuse. The importance of regulation is the message of this financial crisis.
The root of the US financial crisis lies in its highly non-regulated banking and financial market. The problem started with the uncontrolled sanction of loans, especially mortgage loans. Banks and other lending bodies were not careful enough to check the repayment capacity of the borrower. Banker and other lenders were taking the undue advantage of a Tax regulatory system. They were misusing it to full fill their non-feasible credit business expansion plan. When the creditors were unable to repay the amount of the debt were increasing at an alarming rate. The complex structure of debt instruments made it difficult to understand. The common people either couldn’t anticipate or were misguided about the debt instruments. Very long ten sure of this type of financial instruments is one of the biggest risks involved in it. In case of non-payment, the future instalment amounts get increased by a considerable amount. This reduces the probability of future repayment. Accumulation of loan amount first makes the client bankrupt. The&nbsp.mass number of such incidence in society creates the possibility of finding potential buyers of the property.&nbsp.