Financial Crisis

A financial crisis is often referred to a situation where a significant number of banks or other financial institutions face losses that threaten their existence, or experience a problem with liquidity, the ability to pay their obligations. The last major financial crisis in the U.S. took place after the problems with asset-backed securities and derivatives emerged in 2007, leading to an almost-collapse of the entire financial system. Similar problems emerged in Europe in 2009-2011, when a solvency crisis of multiple countries threatened the banking sector.