Great Depression and Global Financial Crisis

Vocabulary flashcards focusing on key terms and concepts related to the Great Depression and the 2008 Global Financial Crisis.

Great Depression

A global economic downturn that occurred during the 1930s, marked by high unemployment and severe deflation.

Nominal Variables

Economic indicators that are measured in monetary terms without adjusting for inflation.

Real Variables

Economic indicators that are adjusted for inflation and reflect the true value.

Gold Standard

A monetary system where a country's currency has a value directly linked to gold.

Bank Runs

A situation where a large number of customers withdraw their deposits simultaneously due to concerns about a bank's solvency.

Securitization

The process of converting an asset, such as a loan, into a marketable security.

Subprime Mortgages

Loans granted to borrowers with poor credit histories, representing a higher risk of default.

Leverage

The use of borrowed capital to increase the potential return on investment.

Deflation

A decrease in the general price level of goods and services, often leading to increased real debt burdens.

Collateralized Debt Obligations (CDOs)

Financial tools that pool various loans and debts and sell them as securities to investors.