US Recession 2008 Powerpoint Presentation Slides
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The document outlines the significant impacts of the 2008 financial crisis, highlighting key financial figures and bailouts involving major institutions such as AIG and Bear Stearns. It discusses the root causes, including subprime mortgages and excessive lending by investment banks, leading to widespread defaults and a severe recession. The aftermath includes regulatory changes and ongoing concerns about the financial industry's practices, with parallels drawn to previous economic crises.
US Recession 2008 Powerpoint Presentation Slides
- 1. US Recession 2008 Your Company Name
- 2. 2 2008 Financial Crisis Impact Explained in Numbers Option Fannie mae & Freddie mac guarantee 90% of all mortgages. $144.5 Bn moved from money market to treasury bonds. Treasury department spent $439.6 Bn buying bank & car stocks . Housing prices fell 31.8%. 30 Bn federal guarantee for deal between JP Morgan Chase & Bear Stearns. $182 Bn federal bailout for AIG. Unemployment was still above 9% in 2010. Source: The Balance 2020 This slide is 100% editable. Adapt it to your needs and capture your audience's attention.
- 3. 3 Major Financial Bubble Burst of all Times Dow Jones Industrial Average Losses neared 90% by 1932 1929 Nikkei 225 20-year bear market, losses hit 82% 1989 Precious Metals Silver fell 25% in 5 Days 2011 US Housing Market Homebuilding stocks lost 90%in value 2005 Bitcoin Loss of 25% in just 1 day 2020 Crude Oil Dropped 77% in 6 months 2008 Precious Metal Silver fell 66% in 2 months 1980 NASADQ & the Internet boom Fell 30% 1 month after record high 2000 This slide is 100% editable. Adapt it to your needs and capture your audience's attention.
- 4. 1 Goldman Sachs 2 2 Deutsche Bank 6 3 Morgan Stanley 4 4 Citi 2 5 JP Morgan 1 6 Credit Suisse 7 7 UBS 10 8 Merrill Lynch1 NA 9 Lehman Brothers2 NA 10 Barclays 7 4 Impact of the Great Recession on Investment Banks Note: 1Bank of America acquired Merrill Lynch in September 2008; 2Lehman filed for bankruptcy and sold it’s investment banking business to Barclays & Nomura This slide is 100% editable. Adapt it to your needs and capture your audience's attention. Investment Bank Rank in 2007 Rank in 2020
- 5. 5 2008 Financial Crisis Cost Total US$ 1,488B APRA Tax Cuts & Spending US$ 831B TARP Bank Bailout US$ 440B Bear Stearns Bailout US$ 30B Fannie & Freddie Bailout US$ 187B This graph/chart is linked to excel, and changes automatically based on data. Just left click on it and select “Edit Data”.
- 6. Key Figures of the Crisis 6 Then: US Treasury Secretary Now: Chairman of Paulson institute, a think tank he set up at the University of Chicago in 2011 Hank Paulson Then: Chairman, Federal Reserve Now: Senior advisor to Citadel, a hedge fund Ben Bernanke Then: President, Federal Reserve bank of New York, and later, treasury secretary Now: President Warburg Pincus Timothy Geithner Then: Chairman & CEO, JP Morgan Chase & Co Now: Same Jamie Dimon Then: Chairman & CEO, Merrill Lynch Now: Member of Supervisory board, Deutsche bank AG John Thain Then: Chairman & CEO, Lehman Brothers Holdings Now: Founder, Chairman & CEO Matrix Investment Management Richard Fuld This slide is 100% editable. Adapt it to your needs and capture your audience's attention.
- 7. 7 Before the Beginning In 2001, the U.S. economy underwent a minor, short-lived recession. Although the U.S. economy nicely withstood terrorist attacks, the bust of the dot-com bubble and accounting scandals, the fear of recession was the top concern for everyone. To keep recession away, the Federal Reserve lowered the Federal funds rate 11 times - from 6.5% in May 2000 to 1.75% in December 2001 - creating enormous liquidity in the economy. To make things merrier, in October 2004, SEC relaxed the net capital requirement for five investment banks - Goldman Sachs, Merrill Lynch, Lehman Brothers, Bear Stearns and Morgan Stanley - which freed them to leverage up to 30-times or even 40-times their initial investment. This easy and excess money found its prey in restless bankers and borrowers with little or no income; also referred as Subprime borrowers (Explained in Appendix). These subprime borrowers wanted to realize their life's dream of acquiring a home. More home loans, more home buyers, more appreciation in home prices. It wasn't long before things started to move just as the cheap money wanted them to. This slide is 100% editable. Adapt it to your needs and capture your audience's attention.
- 8. 8 What Happened then? Even this wasn’t enough, what was going to happen next worsened the situation. This environment of easy credit and the upward spiral of home prices made investments in higher yielding subprime mortgages look like a new rush for gold. The mortgage lenders wanted more money to lend to homebuyers, so they sold their existing loans to banks and to Freddie mac and Fannie may, which in turn sold these to investment banks. This environment of easy credit and the upward spiral of home prices made investments in higher yielding subprime mortgages look like a new rush for gold. This slide is 100% editable. Adapt it to your needs and capture your audience's attention.
- 9. The investment banks combined these loans with hundreds of others into what are known as collateralized debt obligations (CDOs) (Explained in Appendix) and sold these to investors worldwide as mortgage-backed securities (MBS) 01 CDO issuance hit $634 billion in 2007 03 The returns depended on monthly payments on the loans 02 Credit Rating agencies called these sound investments, when they were not. No surprise there, as the investment banks were their clients 04 9 How did it spread? This slide is 100% editable. Adapt it to your needs and capture your audience's attention.
- 10. How did those who Bought CDO Protect themselves? 10 This is where another infamous term from the crisis comes in: credit default swaps. Insurance companies used these instruments to cover investors’ losses if homebuyers defaulted on loans. No one expected the party to wind down and so there were no worries. They thought an insurance product called credit default swaps protected them. A traditional insurance company known as the American international group (AIG) sold these swaps. When the derivatives lost value, AIG didn't have enough cash flow to honor all the swaps. This slide is 100% editable. Adapt it to your needs and capture your audience's attention.
- 11. Beginning of the End 11 Housing prices started falling in 2006 and homebuyers began defaulting on their loans, which meant insurance companies couldn’t honour all their credit default swaps. Within a few weeks in September 2008, Lehman Brothers, one of the world’s biggest financial institutions, went bankrupt. £90bn was wiped off the value of Britain’s biggest companies in a single day. The Federal Reserve began pumping liquidity into the banking system via the Term Auction Facility. But that wasn't enough. As a result, interbank borrowing costs, LIBOR, rose. This mistrust within the banking community was the primary cause of the 2008 financial crisis Banks panicked when they realized they would have to absorb the losses. They stopped lending to each other. They didn't want other banks giving them worthless mortgages as collateral. This slide is 100% editable. Adapt it to your needs and capture your audience's attention.
- 12. 12 Subprime Effect This slide is 100% editable. Adapt it to your needs and capture your audience's attention. UK France Belgium USA China Australia Netherlands Germany
- 13. 13 Major Bailout Packages Bear stearns approached JP morgan chase to bail it out. The fed had to sweeten the deal with a $30 billion guarantee. By 2012, the fed had received full payment for its loan. The Fed loaned $85 billion to AIG as a bailout. Later, the Fed and Treasury restructured the bailout and total cost ballooned to $182 billion. But by 2012, the government made a $22.7 billion profit Treasury Secretary took over mortgage companies Fannie Mae and Freddie Mac costing $187 billion at the time. Since then, Treasury has made enough in profits to pay off the cost. TARP (Troubled Asset Relief Fund) disbursed $442.6 Bn to banks for bailout. This slide is 100% editable. Adapt it to your needs and capture your audience's attention.
- 14. Penalties paid by banks between 2009 & 2016 is $321 Bn 63% European Banks 37% Recipients of Penalties Sales 6% Consumers 56% North American Regulators 38% European Regulators 14 Banks have Paid Billions of Dollars in Fine North American Banks This graph/chart is linked to excel, and changes automatically based on data. Just left click on it and select “Edit Data”.
- 15. After a Decade – Current Scenario 15 While the world economy has recovered from the crisis and the Dow jones industrial average has risen nearly four times since its 12-year low in march 2009, big worries remain: S&P, Fitch and Moody’s are still dominant players, earning more than $9 out of every $10 in the credit-rating industry Top 10 commercial banks still account for more than half of the assets held by 100 largest commercial banks, similar to a decade ago Some complex derivative instruments vilified during the crisis are back in demand. For instance, synthetic CDOs, which invest in CDSs, were expected to quadruple to $100 bn in 2017 from 2015 US President Donald Trump wants to dismantle the Dodd-Frank Wall Street Reform and Consumer Protection Act, a key law passed in 2010 to tighten financial regulation in the aftermath of the crisis This slide is 100% editable. Adapt it to your needs and capture your audience's attention.
- 16. 16 Fed Tapering This slide is 100% editable. Adapt it to your needs and capture your audience's attention. 01 Tapering is the gradual reversal of a quantitative easing policy implemented by a central bank to stimulate economic growth Tapering came to the picture in 2013 when, then Fed chairman, Ben Bernanke commented that the Federal Reserve would . 04 Tapering refers to the reduction, not the elimination, of Fed asset purchases. 02 Tapering prematurely can lead to a recession while delaying it could lead to an unwelcome rise in inflation. 03
- 17. 17 Quantitative Easing This slide is 100% editable. Adapt it to your needs and capture your audience's attention. A central bank can implement quantitative easing by purchasing government bonds from commercial banks and other private institutions, which should lower short-term interest rates and increase the capital available to institutions to promote increased lending and liquidity. Quantitative easing increases the money supply by flooding financial institutions with capital in an effort to promote increased lending and liquidity. Quantitative easing is an unconventional monetary policy in which a central bank purchases government securities or other securities from the market in order to lower interest rates and increase the money supply. Quantitative easing is considered when short-term interest rates are at or approaching zero, and does not involve the printing of new banknotes.
- 18. 18 US Recession 2008 Icons Slide
- 19. 01. Clustered Column-Line 02. Bar Chart 03. Our Vision Mission Goal 04. Venn Diagram 05. Timeline Process 06. Comparison 07. Idea Generation 08. SWOT Analysis 09. Thanks for Watching! 19 Additional Slides
- 20. Clustered Column-Line 20 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2017 2018 2019 2020 Financial Year Product 02 This graph/chart is linked to excel, and changes automatically based on data. Just left click on it and select “Edit Data”. Product 01 This graph/chart is linked to excel, and changes automatically based on data. Just left click on it and select “Edit Data”. Product 03 This graph/chart is linked to excel, and changes automatically based on data. Just left click on it and select “Edit Data”.
- 21. Bar Chart 21 20 28 40 60 45 42 62 85 65 50 85 70 0 10 20 30 40 50 60 70 80 90 100 Q1 Q2 Q3 Q4 Unit Count Product 02 This graph/chart is linked to excel, and changes automatically based on data. Just left click on it and select “Edit Data”. Product 01 This graph/chart is linked to excel, and changes automatically based on data. Just left click on it and select “Edit Data”. Product 03 This graph/chart is linked to excel, and changes automatically based on data. Just left click on it and select “Edit Data”.
- 22. 22 Our Vision Mission Goal This slide is 100% editable. Adapt it to your needs and capture your audience's attention. Our Mission This slide is 100% editable. Adapt it to your needs and capture your audience's attention. Our Vision This slide is 100% editable. Adapt it to your needs and capture your audience's attention. Our Goal
- 23. Venn Diagram 23 This slide is 100% editable. Adapt it to your needs and capture your audience's attention. Your Text Here This slide is 100% editable. Adapt it to your needs and capture your audience's attention. Your Text Here This slide is 100% editable. Adapt it to your needs and capture your audience's attention. Your Text Here 03 01 02
- 24. Timeline Process 24 2017 This slide is 100% editable. Adapt it to your needs and capture your audience's attention. 2019 This slide is 100% editable. Adapt it to your needs and capture your audience's attention. 2016 This slide is 100% editable. Adapt it to your needs and capture your audience's attention. 2018 This slide is 100% editable. Adapt it to your needs and capture your audience's attention. This slide is 100% editable. Adapt it to your needs and capture your audience's attention. 2020
- 25. Facebook This slide is 100% editable. Adapt it to your needs and capture your audience's attention. 30% Users Instagram Users This slide is 100% editable. Adapt it to your needs and capture your audience's attention. 70% Comparison 25
- 26. Idea Generation 26 Your Text Here This slide is 100% editable. Adapt it to your needs and capture your audience's attention. Your Text Here This slide is 100% editable. Adapt it to your needs and capture your audience's attention. Your Text Here This slide is 100% editable. Adapt it to your needs and capture your audience's attention.
- 27. SWOT Analysis 27 Strengths This slide is 100% editable. Adapt it to your needs and capture your audience's attention. Weaknesses This slide is 100% editable. Adapt it to your needs and capture your audience's attention. Opportunities This slide is 100% editable. Adapt it to your needs and capture your audience's attention. Threats This slide is 100% editable. Adapt it to your needs and capture your audience's attention.
- 28. 28 Thanks for Watching! emailaddress123@gmail.com Email Address # Street number, city, state Address 0123456789 Contact Number