The Global Financial Crisis: Examining the Resultant Implications in the Context of Saudi Arabia

Abstract

Since the Great Depression witnessed in 1930s, the global financial crisis witnessed during the period 2007-2008 is considered as the worst crisis in the economics sector. With the subprime home mortgage sector faced with high default rates that formed a primary or precipitating factor, the impact of the crisis to regions across the world cannot be overemphasized. With the Community Reinvestment Act encouraging the expansion of the mortgage sector, mist of these high-risk subprime loans was bundled to yield mortgage-backed securities that would then be sold as low-risk securities.