Crises & Unemployment

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Crisis and Unemployment by Serdar Bayraktaroğlu

description

Krizler ve İşsizlik Arasındaki Bağlantıyı Ekonomik Açıdan Anlatan Bir Sunum

Transcript of Crises & Unemployment

Page 1: Crises & Unemployment

Crisis and Unemployment

bySerdar Bayraktaroğlu

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Basic Definitions

What is a Crisis?

A Crisis is an event that can destroy or affect an entire organization.

11Little time in which to act or respond

22 Missing or uncertain information

33 A threat to resources or people.

Characteristics of A CrisisCharacteristics of A Crisis

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Basic Definitions

What is An Economic Crisis?An economic crisis refers to a period in which undesigned and imponderable progress causes to negative macro - and microeconomic consequences.

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Types of Economic Crises

Banking crises1

Speculative bubbles and crashes2

International financial crises3

Wider economic crises4

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Types of Economic Crises

Banking crises1

Banking crisis is a type of financial crises in which a large number of panicky customers try to withdraw their funds from the bank they believe may fail.

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Types of Economic Crises

What is a bubble ? An economic bubble is “trading with high prices that are considerably at variance with intrinsic values. Bubbles generally have a negative impact on the economy because they tend to cause misallocation of resources into non-optimal uses. In addition, the crash which usually follows an economic bubble can destroy a large amount of wealth and cause negatively economic circumstances.

Speculative bubbles and crashes2

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Types of Economic Crises

When a country that maintains a fixed exchange rate is suddenly forced to devalue its currency because of a speculative attack, this is called a currency crisis or balance of payments crisis.

International financial crises3

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Types of Economic Crises

Recession & Depression

Wider economic crises4

What is a recession ?A downturn in economic growth lasting several quarters or more is usually called a recession

What is a depression ?An especially prolonged recession may be called a depression.

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Breakdown in Production & ServicesBreakdown in Production & Services

Causes of Economic Crises

Organizational Causes

Inactive LeadershipInactive LeadershipInactive LeadershipInactive Leadership

Inactive Monetary ManagementInactive Monetary ManagementInactive Monetary ManagementInactive Monetary Management

Incapable AuditingIncapable Auditing

Disordered Balance SheetsDisordered Balance Sheets

Inactive Financial ManagementInactive Financial Management

Liquidity ProblemsLiquidity Problems

Extreme GrowthExtreme Growth

HierarchyHierarchy

CentralismCentralism

Organizational StructureOrganizational StructureOrganizational StructureOrganizational Structure

Receivable collecting problemsReceivable collecting problems

Shortfall of cashShortfall of cash

Coordination FailureCoordination Failure

Unplanned ManagementUnplanned Management

Management Without VisionManagement Without Vision

Lack of CommunicationLack of Communication

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Causes of Economic Crises

NonOrganizational

Causes

TTechnologic echnologic CChangeshangesTTechnologic echnologic CChangeshanges

EEcologic cologic CChanges and hanges and NNatural atural DDisastersisastersEEcologic cologic CChanges and hanges and NNatural atural DDisastersisasters

FloodingFlooding

EarthquakeEarthquake

Climatic irregularityClimatic irregularity

Political ChangesPolitical Changes

Economic changesEconomic changesEconomic changesEconomic changes

Governmental CrisisGovernmental CrisisMilitary CoupMilitary Coup

BiotechnologyBiotechnology

Communication TechnologyCommunication Technology

Information TechnologyInformation Technology

InventionsInventions

Political UnstabilityPolitical Unstability

HyperinflationHyperinflation

DeregulationDeregulation

Intensive CompetitionIntensive Competition

LocalizationLocalization

Demand DownturnDemand Downturn

Supply DownturnSupply Downturn

GlobalizationGlobalization

Economic LiberalizationEconomic Liberalization

Increasing Tax RatesIncreasing Tax Rates

DepressionDepression

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Consequences of Economic Crises

Effects of Economic Crisis : Unemployment and Income

Loss ( mass impacts ) overcome the turbulence

with the least effect text

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Crises

1929 1929 CrisisCrisis

The Great Depression was a worldwide economic depression originated in the United States and started in most countries in 1929 and continued till 1930s or early 1940s for different countries. It was the largest and most important economic crisis in history, and is used as an example of how far the world's economy can fall.

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Crises

1994 1994 CrisisCrisis

The Turkish economy remained an inward-oriented closed economy until the government launched an economic reform and stabilization program on 80s to liberalize the Turkish economy. The stabilization programhas a favorable impact on the Turkish economy, transforming it into an export-oriented, private-sector-driven economy. as the economy flourished, however, increasing political competition forced the government to compromise the stabilization program and pursue fiscally damaging populist economic policies, which resulted in an economic crisis in the beginning of 1994.

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Crises

1994 1994 CrisisCrisis

The government responded to the economic crisis by launching an IMF backed economic stabilizationprogram. As the economy recovered and economic stability improved, the government delayed continued implementation of the structural measures of the stabilization program, which resulted in the furtherdeterioration of the Turkish economy until the worsening fiscal situation eventually culminated in another major economic crisis in 2001.

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Crises

1997 1997 CrisisCrisis

1997 asian crisis was a period of financial crisis which has started in july 1997 in thailand with the financial collapse of the Thai baht through the decision of the government to float money to devaluate the national currency.

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Crises

2001 2001 CrisisCrisis

The 2001 crisis of Turkey preceded by a financial turmoil that burst in the second half of November 2000 just at the midst of an exchange rate based stabilization program. As of the end of December2000, the average interest rates were almost four times higher than their levels at the beginning of Novemberand more than five times higher than the pre-announced year-end depreciation rate of the lira.This unsustainable situation ended on the February 19, 2001, when the prime minister announced that there was a severe political crisis. Three days later, the exchange rate system collapsed and Turkey declared that it was going to implement a floating exchange rate system.

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Crises

2008 2008 CrisisCrisis

The global financial crisis of 2008 became in september '08 visible. With the bursting of U.S. Housing bubble the mortgage crisis has occured. Consequent failures of U.S. and European investment banks, insurance firms and mortgage banks it rapidly evolved into a global crisis resulting in a number of European bank failures and declines in various stock indexes, and large reductions in the market value of equities and commodities worldwide. The crisis has led to a liquidity problem and the de-leveraging of financial institutions especially inthe United States and Europe, which further accelerated the liquidity crisis.

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Precautions

Macro

Generally macroeconomic unstabilities lie behind economic crises. In that case the priority is to reestablish the macroeconomicstability. Political stability is the way to provide macroeconomic stability. Structural reforms about regulations, fiscal discipline, trust and stability must be legislated by all means. Monetary discipline is important. Government obligations have toBe constitutional just like it is in European Union. ( Maastricht Treaty) Public borrowings rate should have strict discipline thanks to the constitutional obligations. Tax System should be reordered considering principles of equity, justice, stability and efficiency. Diminishing pressure of taxes and reducing untaxed economy would be helpful.

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Precautions

Micro

Although macroeconomic precautions are a necessary for the economic stability microeconomic regulations are also required to cure economic crises. Effective applying of Total Quality Management as the modern management mentality,Effective applying of innovative management technics in organizationsGetting high quality, low costs, speed and effective services andrestructuring thanks to the reengineering process

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Effects of Crises

2008USA

1929USA 1994

Turkey

1997ASIA

2001Turkey

UnemploymentUnemployment

The biggest effect of crises is

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Between 1929-1942

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USA Emplyment Rates

1981

1982

1984

1985

1986

1987

1991

1992

1994

1997

2000

2003

2005

2007

7,6

9,7

7,57,2

7

6,2

6,7

7,4

6,1

4,9

4

6

5,1

4,6

0

1

2

3

4

5

6

7

8

9

10

Unemployment

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Unemployment Rates of All World

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Evolution of unemployment

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2003.10 Add Your Text2003.10 Add Your Text2003.10 Add Your Text

ASIA 1997

TURKEY1994

USA2008

Asian Financial CrisisDeveluations and BankingCrises across Asia

2002.10 Add Your Text2002.10 Add Your Text2002.10 Add Your Text

The Great Depression A worlwide economic downturn TURKEY

2001

Global Financial CrisesSpread of the U.S. Subprime Mortgage Crises

USA 1929

Historical Events