In e na ional Jou nal o Enginee ing In en ions
e-ISSN: 2278-7461, p-ISSN: 2319-6491
Volume 14, Issue 9 [Sep embe 2025] PP: 148-158
www.ijeijou nal.com Page | 148
An empi ical e alua ion o he e ec s o in e es a es and
he inancial c isis on he global s ock ma ke index
D . V. Thanga el
Head-LIRC & Lib a ian. S . F ancis Ins i u e o Managemen and Resea ch, Mumbai, India
Email: . hanga[email p o ec ed], ORCID: 0009-0002-6647-2599
Abs ac : Any na ion ha expe iences a inancial c isis will see nega i e consequences on i s inancial
en i onmen and economy. The inancial c isis caused inancial ins i u ions o be dis up ed, he s ock ma ke o
luc ua e, and unemploymen . Mos o he esea ch concen a ed on he long- e m consequences o he
inancial c isis on he economy, as well as how i a ec ed cu ency and s ock ma ke mo emen s, and how i
a ec ed he global economy. Howe e , since he 1929 global inancial c isis(GFC), no esea ch has o e ed a
ho ough examina ion o he e ec s o inancial c ises on he global economy. The main objec i es o his s udy
a e o e iew he e alua ion o he global inancial c isis since 1929 and o examine i s impac s.
Keywo ds: inancial c isis, global inancial c isis, s ock ma ke , iscal policy, dep ession, inancial sys em.
---------------------------------------------------------------------------------------------------------------------------------------
Da e o Submission: 15-09-2025 Da e o accep ance: 30-09-2025
---------------------------------------------------------------------------------------------------------------------------------------
I. INTRODUCTION:
A inancial c isis ha p ecipi ously educes he nominal alue o inancial asse s. In a inancial c isis,
he alue o inancial asse s dec eases, and businesses a e unable o mee hei inancial obliga ions due o a
lack o app op ia e cash o con e ible asse s. Du ing he inancial c isis, comme cial houses we e unable o
in es in p ojec s and could no mee immedia e needs. Financial c ises include c ashes in he s ock ma ke ,
bu s s o inancial bubbles, money c ises, and so e eign de aul s. Included a e inancial c ises ha dis u b
cu encies, s ock ma ke c ashes in eal economies, unemploymen , and ailu es o inancial ins i u ion
ope a ions. Ca ego ically, he e a e h ee s ages o he inancial c isis. In he i s s ep, he sys em and egula o y
ailu es and mismanagemen o inances. The second s ep ep esen s he b eakdown o he inancial sys em,
business ope a ions, and consume s' inabili y o mee inancial obliga ions. Finally, he nominal alue o asse s
alls, and he o e all deb inc eases. The e is a di e ence be ween a inancial c isis and a iscal c isis. A
inancial c isis e e s o he economic and inancial en i onmen , whe eas a iscal c isis includes a p oblem wi h
he go e nmen 's egula o y amewo k and balance shee . A iscal c isis ela es o go e nmen deb o
pe o mance issues. In he same cou se, dis inc ions a e made be ween he inancial c isis and he global
inancial c isis (GFC). I ep esen s a pe iod o s ess in global inancial ma ke s and banking sys ems, clashes
o he s ock ma ke , c edi c unches, he bu s o inancial bubbles, egula o y ailu es, and he cu ency c isis.
The inancial c isis is limi ed o a segmen o coun y and is sp eading egionally o globally. Many ac o s a e
de e mined o in luence he inancial c isis. These a e (i) o e alua ion o asse s, (ii) ailu es o egula ions, (iii)
cus ome s wi hd awing huge unds om inancial ins i u ions, e c. I is a gene alized, sys ema ic isk in he
inancial sec o ha exagge a es one coun y o ano he . Financial c ises escala e bu do no in luence
ecessions. The main causes o he GFC we e isk- aking in he mac oeconomic en i onmen and he
mobiliza ion o bonds and equi ies by banke in es o s. The go e nmen ames iniqui ous egula ions o policy
aul s, huge bo de ansac ions, and egula ions, as well as inancial ma ke s.
1.1. Causes o Global Financial Inclusion:
1. Added isk- aking in a posi i e mac oeconomic en i onmen . In he U.S., in ecen yea s, he
mac oeconomic en i onmen has been posi i e, wi h low in la ion, unemploymen , and in e es a es. In his
en i onmen , house p ices lou ished s ongly. Banks and o he lende s a e o ake addi ional isks by bo owing
huge amoun s o money and lending in he housing sec o . A epaymen o loans by he bo owe , he e is no
e und o loans, as in he GFC.
2. G ew bo owing by banks and in es o s: The main eason o he GFC is ha banks and o he in es o s
a e aising huge unds on mo gage-backed secu i ies (MBS) and hypo hesizing huge unds o pu chase an asse
(le e age). In he u u e, he alue o he asse s will dec ease as banks and in es o s incu losses.
3. Regula ions and policy e o s: Fo he GFC, ano he cause is ha he aming o policies and egula ion
An empi ical e alua ion o he e ec s o in e es a es and he inancial c isis on he global ..
www.ijeijou nal.com Page | 149
e o s is also con ibu ing o he GFC. Banke s and in es o s a e p o iding loans based on MBS. A he ime o
epaymen , he bo owe is adjou ning he paymen o loans, in luencing he GFC. The inancial c isis is ei he
igh o w ong. I a ies om coun y o coun y.
i. The c isis will in luence he ins abili y o he global economy a he same ime as he logical ou g ow h
o an economy and economic globaliza ion.
ii. A subs an ial c isis leads o a spillo e o capi al om coun y o coun y, and i also de as a es
wo ke s, he en i onmen , and he di e si y o cul u e.
iii. The economis says he inancial c isis is w ong, bu i led o new ac ions by he go e nmen , and in
he long un, i will bene i he na ion.
i . The inancial c isis ini ially causes s uggle among coun ies, commi ees, egions, and ci izens, bu i
will ind a solu ion and bene i he people, communi ies, and coun ies.
II. HISTORY OF FINANCIAL CRISIS:
The inancial c isis has a long his o y; i s a ed in 33 A.D. and con inues o his day. The inancial
panic was con on ed in A.D. 33 due o massi e loans aken by he Roman banking house. In he Roman5-284
A.D., he Roman Empi e con on ed a inancial c isis due o ci il wa s, peasan ebellions, and poli ical
ins abili y. The consequences o he c isis a e he de alua ion o he cu ency and economic dep ession. In he
7 h cen u y (692), he coin exchange c isis was me due o A ab gold coins' ac ual weigh being less han
nominal quali y. This c isis dis esses he inancial sys em o ha coun y. 14 h cen u y, 1345 banking c isis, he
c ash o he Pe uzzi and he Ba di amilies, 17 h cen u y (1618–1648): Kippe and Wippe Roman Empi e
challenged a inancial c isis by way o he 30-yea wa . The cloud o ax paymen s, lowe cu ency, and aised
e enue du ing his ime. In he 18 h cen u y (172), he U.K. Sou h Sea Bubble was aised due o public and
p i a e pa ne ships and a emp s o educe he na ional deb . In he 17 h–18 h cen u ies, he e we e ex ensi e
c ises in Eu ope, namely he G ea Tobacco Dep ession in 1703 in B i ish Ame ica and he 1769 G ea Eas
Indian Bengal Bubble C ash. In 1720, he F ench-Mississippi Company was a business Monopoly in he F ench
Colonies. The company's ac i i ies inc eased o dec eased because o he c isis. In 1763, Leende Pie e de
Neu ille and Johann Go zkowsky— Du ch me chan s and banke s— aded silk, linen, and g ain. This c isis
sp ead o Ge many and Scandina ia. A his ime, a ious business models we e in en ed o he g ow h o he
business. The G ea Eas Indian Bengal Bubble C ash 1769 Ba le, Cli e, and he company acqui e inc easing
powe s in Bengal. O e alua ion o Eas India s ock be ween 1757 and 1769. The alua ion o Eas India
Company s ock was aised be ween 1757 and 1769. In 1772, London and Ams e dam collapsed unde banke s
Neal, James, Fo dyce, and Down. In 1776, du ing he Ame ican Independence Financing C isis and he F ench
Re olu ion, he e we e 1.4 billion li e in es men s; in ha spin in es men , he e we e 700 million. 19 h
Cen u y, 1813–1818: Danish Economic C isis: I began in 1813 and con inued un il 1818. Fo his eason,
Denma k s uggled wi h an economic c isis owed o Napoleon as he cu ency was de alued, which hu
me chan banke s. In 1819, 1825, 1837, 1847, 1857, and 1866, due o economic cycle e ec s in he U.S., he
B i ish ecession caused many banks o ail, a 5-yea dep ession in he U.S., he collapse o B i ish inancial
ma ke s, a dec easing in e na ional economy, o e expansion o he domes ic economy, and a down u n o
in e na ional inancial ma ke s in London. 1873–1896 was a long dep ession aced by wo coun ies: he U.S.
and Eu ope. Du ing his ime, wo ldwide p ices and economic dep ession s a ed in 1873 and con inued un il
1896. A e wa d, he s ong g ow h was accele a ed by he Second Indus ial Re olu ion. Du ing his
pe iod, bank ailu es and c edi sho ages in he U.S., Economic dep ession in Eu ope and No h Ame ica, and a
bank c isis in Aus alia due o building socie ies and he numbe o comme cial banks u ning. In he 20 h
cen u y, majo inancial c ises ollowed; hese a e he GFC's e ec s on a ious coun ies h oughou he globe.
In 1972, he c edi c isis o igina ed in London and sp ead o he es o Eu ope. The B i ish Empi e had aken
unds om colonial possessions and ade in he mid-1760s. This news was sp ead in England and la e in
Eu ope. As c edi o s in panic s a ed wi hd awing unds om he B i ish banks. This e ec caused a c isis in
Sco land, he Ne he lands, and o he pa s o Eu ope. The G ea Dep ession o 1929–1939 in he 20 h cen u y
was one o he nas ies economic disas e s. Wall S ee a ibu ed he policy inaccu acy o he US go e nmen as
he eason his c isis occu ed. This c isis was massi e om 1929 o 1939, wi h a plumme ing na ional income,
inc eased unemploymen a es, and educed ou pu in indus ial na ions. In 1933, he unemploymen a e was
almos 25%.
III.REVIEW OF LITERATURE:
a. G eenspan (2009)12: s a ed his opinion ha he GFC in luenced huge losses in equi y homes, unlis ed
co po a ions, and non-co po a e businesses. I es ima es he loss o 2/3 o global GDP in 2009. In he s udy,
An empi ical e alua ion o he e ec s o in e es a es and he inancial c isis on he global ..
www.ijeijou nal.com Page | 150
S ephanie B andenbu g and Jose Gab iel Palma (2009) emphasize hei ideology abou he ace s and ea u es
as well as he long- e m consequences aised by he c isis. The numbe o con ibu ions has in luenced he GFC
om a sho - o long- un pe spec i e. On he poli ical side, any aming o new policies in e ms o adical
inancial de egula ion can in luence a inancial c isis.
b. Pe ez (2009)4: Resea che s deno e ha he 1990 c isis is he same phenomenon as he 1929 c isis.
1990s "do com’ in e ne c isis and he ea ly 2000s c isis ela ed o he liquidi y boom. Hence, bo h c ises ha e
he same s uc u e as he 1929 c ash and he dep ession.
c. T egenna (2009)5: s a es in a de ailed in es iga ion based on empi ical analysis ha , p e-c isis, he US
banking sec o concen a ed mo e on p o i abili y han e iciency. These s udy indings a e o call a en ion o
he inc ease in p o i abili y o he banking sec o , he need o u u e egula o y measu es, and some issues
ela ing o he banking s uc u e and p icing beha io in his sec o . Th ee decades o in e na ional inancial
c ises: wha ha e we lea ned, and wha s ill needs o be done? This pape indica es ha o e he pas h ee
decades, we ha e lea ned abou inancial c ises and wo ked o build a s ong inancial sys em o ace a u u e
c isis in he COVID-19 pandemic. Simple, based on pas inancial c ises, s eng hen ou inancial sys em in he
u u e.
IV.RESEARCH PROBLEMS:
Financial ma ke s, inancial ins i u ions, inancial ins umen s, and se ices in any coun y a e all impac ed by
he inancial c isis in some way. A inancial c isis is being impac ed by poli ical and go e nmen al policies and
laws. In he sho o long e m, his will ha e an impac on banking, co po a ions, and non-co po a e en e p ises.
This esea ch ocuses on he signi ican inancial c ises o he p e ious cen u y and how hey would impac he
economies o he a ious na ions as well as he wo ld ma ke . Using empi ical esea ch o assess how he
inancial c isis has a ec ed he economy and de elop p e en a i e measu es agains u u e inancial c ises.
V.AIM OF THE STUDY:
The ollowing objec i es a e de e mined by he esea che based on empi ical analysis:
➢ To e iew he his o y o he wo ld inancial c isis since 1929,
➢ To examine how he inancial c isis has a ec ed he wo ld economy.
➢ To examine and in es iga e he impac o US in e es a es on he global ma ke index and o ecommend he
bes inancial and go e nmen al policies o managing u u e inancial c ises.
VI.METHODOLOGY OF THE STUDY:
The in o ma ion and da a a e based on seconda y da a and a e used in empi ical s udies and esea ch
publica ions. Using in o ma ion ga he ed om he Dow Jones-DJIA 100-Yea His o ical Da a, we can examine
how se e al inancial c ises ha e a ec ed he global s ock ma ke since 1929.
VII.DATA ANALYSIS:
Resea che s ha e measu ed he inancial c ises o many na ions based on he da a a ailable om he websi e o
unde s and each coun y o g oup o coun ies' inancial c ises and how hey a ec ed he s ock ma ke . inding
ou he leng h o he inancial c isis and i s e ec s on he s ock ma ke using s a is ical app oaches. Fu u e
in es o s can use his s udy o assis hem in choosing wisely whe he o in es in di e en s ocks du ing a
inancial c isis.
An empi ical e alua ion o he e ec s o in e es a es and he inancial c isis on he global ..
www.ijeijou nal.com Page | 151
Figu e 1: Dow Jones-DJIA 100-Yea His o ical Cha
Sou ces: F om Dow Jones-DJIA S ock Index
Table:01 Dow Jones-DJIA-100 Yea His o ical S ock Ma ke Index
Yea
s-DJIA-100 Yea -Global S oc
Financial C isis
Yea
s-DJIA-100 Yea -Global S oc
Financial C isis
Yea
s-DJIA-100 Yea -Global S oc
Financial C isis
Yea
s-DJIA-100 Yea -Global S oc
Financial C isis
2177.52
1942
1796.58
1969
7940.65
1996
10883.75
2565.69
1943
2408.69
1970
6238.21
1997
12482.28
2445.07
1944
2420.68
1971
6858.74
1998
16455.64
1655.73
1945
2631.61
1972
6974.98
1999
19690.00
1687.17
1946
3409.02
1973
6411.31
2000
19009.75
1397.16
1947
2363.71
1974
5288.26
2001
18410.47
1316.83
1948
2297.22
1975
4421.47
2002
17655.49
1617.59
1949
2257.32
1976
4686.41
2003
13163.04
1855.72
1950
2648.57
1977
4686.41
2004
16504.07
1617.29
1951
3046.85
1978
3974.76
2005
15890.12
2116.62
1952
2960.43
1979
3673.51
2006
17118.91
2435.60
1953
3191.92
1980
2975.64
2007
18247.37
2807.00
1954
3422.68
1981
3441.27
2008
17425.57
Recession o 20
3804.56
1955
4655.01
1982
2641.09
2009
11623.23
5511.43
The G ea Dep ession o 1932 Impac abou 10
yea s
1956
5820.29
Suez C isis 1956
1983
3773.02
2010
15323.99
4982.86
1957
5375.18
1984
3444.35
2011
17281.42
2959.09
1958
4785.16
1985
3611.59
2012
17466.32
1224.60
1959
6316.15
1986
5070.28
2013
18995.84
1333.81
1960
6361.98
1987
6236.49
2014
21131.64
2323.10
1961
6888.09
1988
5265.77
2015
22871.55
2406.04
1962
6683.24
1989
5959.92
2016
22536.98
3225.57
1963
7138.24
1990
6251.36
2017
25705.05
An empi ical e alua ion o he e ec s o in e es a es and he inancial c isis on he global ..
www.ijeijou nal.com Page | 152
3696.96
1964
7984.88
1991
6547.44
2018
29309.38
2128.91
1965
8616.67
1992
7046.92
2019
30932.92
Co id-19
2877.41
1966
8740.00
1993
7221.85
2020
28800.99
3216.33
1967
8221.46
1994
7576.92
2021
38481.83
2451.07
1968
8044.87
1995
8629.58
2022
36585.66
Table:01 Dow Jones-DJIA-100 Yea His o ical S ock Ma ke Index
Table 1 displays da a on he Dow Jones Indus ial A e age om 1915 o 2022. This da a e lec s he
app oxima ely 107-yea luc ua ion in he wo ldwide s ock ma ke index. In es o s will lea n abou se e al
wo ldwide inancial c ises o he pe iod based on hese s a is ics. Fu u e esea che s can use his in o ma ion o
s udy o he inancial op ions o p o ec ing hei in es men s and os e ing economic g ow h amid he inancial
c isis, luc ua ions in he global s ock ma ke , and in e es a es.
VIII.FINANCIAL CRISIS IN THE LAST CENTURY:
The e we e nine o emos inancial c ises h oughou he globe in he las cen u y. These a e he G ea
Dep ession o 1932, he Suez C isis o 1956, he in e na ional deb c isis o 1982, he Eas Asian Economic
C isis o 1997-2001, he Russian Economic C isis o 1992-97, he La in Ame ican Deb C isis in Mexico in
1995, he Global Economic Recession o 2007-09, and he Eu opean Economic C isis o 2010.
a. The G ea Dep ession o 1932: On Oc obe 25, 1929, he e was a da k Tuesday. The New Yo k S ock
Exchange bowed wi h 13 million sha es. Behind his igh ul si ua ion, du ing 1922–1929, he Ame ican
economy had g own by 20% e e y yea o se en yea s, and he s ock ma ke was alued a 218% o he abo e
pe iod. 1929–1939 was he g ea es dep ession in his o y because o he slump a ound he globe. In es o s
wiped ou nea ly $30 billion and los hei weal h. Abou 15 million Ame icans we e unemployed by 1933, and
abou 20 housand companies we e uined. This dep ession sp ead o spilled o e o Eu opean, Aus alian, and
Ge man coun ies. The bigges bank in Aus alia, K edis ans al , c umpled, and he money supply ell by 26%
in he US, 27% in Ge many, and 18% in F ance and he UK. The p ecau iona y measu e was s a ed by he US,
UK, F ance, and Ge many h ough he swi expansion o indus ies. P esiden F anklin D. Roose el p omised
o ake up ans o ma ions in he o m o a 'New Deal' o eco e he economy. These we e (a) special aid o
edundancy, (b) e iewed egula ions o indus ies, a n d (c) legal p o ec ion o wo ke s, and (d) new
p og ams o social secu i y. Du ing his pe iod, he es ima ed GDP ell by 15% in 1929–32. The US GDP in
1939 was 93.5 $USD, 102.9 billion USD in 1940, and 166.0 $USD in 1942. When asse s ose du ing he pe iod,
he la e igu e was highe (IMF, 2009a). The global eco e y was slowe a e 1931; in mos Eu opean na ions,
he ecession s a ed in he mid-1920s. The indus ial sec o was se e ely a ec ed by he c isis (Thilo Albe s
and Ma in Uebele, 2015).
b. The Suez C isis: On he 26 h o July 1956, he Suez Canal Company was na ionalized by Egyp ,
F ance, Is ael, and he U.K. A join accomplishmen on he global p ojec s a ed. These coun ies acqui ed
inancial assis ance om he IMF on Oc obe 10, 1956. These coun ies aced specula i e p essu e and sho -
e m capi al ou lows. Fo his global p ojec , Egyp bo owed wice om he IMF, and Is ael go a a i ied
quo a o 50% o unds om he IMF. In his pe iod, he s ock ma ke collapsed om 5,820 o 4,785, and he
pound, o s e ling, was $2.80 pe dolla wi hou he suppo o he US and G ea B i ain's obliga o y 1.3 billion
USD agains he specula ion o hei cu ency, he pound.
c. The In e na ional Deb C isis 1982–89: This c isis began on Augus 20, 1982, and con inued
inde ini ely un il 1989. I is one o he long- e m deb c ises. Mexico and Poland announced hey we e unable o
pay he deb o he c edi o s, and his c isis sp ead o se e al o he coun ies, such as Romania, Hunga y, and
Yugosla ia. In he mid-1970s, all he de eloping coun ies bo owed huge unds om he global ma ke a a
low in e es a e and main ained deposi s wi h he oil-expo ing na ions. Yea -by-yea deposi s ha e been
inc easing, esul ing in he inabili y o pay he deb o oil-expo ing coun ies. Mexico and Poland we e he i s
lines in he c isis; besides hose, o he coun ies, iz., La in Ame ica (A gen ina, B azil, Chile, Ecuado , Pe u,
and U uguay), encoun e ed deb se icing.

An empi ical e alua ion o he e ec s o in e es a es and he inancial c isis on he global ..
www.ijeijou nal.com Page | 153
d. The Eas Asian C isis o 1997: This c isis was also high in 1997. Thailand was one o he su e e s o
his c isis due o he excessi e ex e nal de ici , he s ock ma ke p ices ampli ied, poo egula ion, and he
absence o supe ision in exchange a es, esul ing in he c isis. Cu en ly, he cu en accoun de ici and he
in e es on o eign obliga ions a e abo e 4% o Thailand's GDP. The c edi o s o Thailand deem ha he cu en
accoun de ici e lec s high business in es men , high-in e es a es on sa ings, and a go e nmen su plus
budge . Ano he coun y, Japan, was also a ic im o his c isis. In 1996–97, he Japanese yen weakened by
35% agains he dolla , and Thailand de alued by 15%–20%. Along wi h he wo na ions' Indonesian economic
c isis, he e ha e been abou 30 yea s o unin e up ed economic g ow h, some hing i has ne e seen in he 20 h
cen u y. The cu ency o Indonesia was de alued abou six imes agains he US dolla . I wen om 2500
upiahs pe US dolla in May 1997 o abou 14000 upiahs pe US dolla by Janua y 1998. Be o e he 1997
inancial c isis, Ko ea was one o he leading economies in he 11 h posi ion on he globe wi h less han a 5%
in la ion a e, 3% unemploymen , and an 8% pe yea GDP g ow h a e. The 1997 economic c isis was
de imen al o Ko ean businesses and inancial ins i u ions, and inc eased sho - e m deb , which was 110
billion USD. I is h ee imes he o eign exchange ese es.
e. The Russian C isis: In he mid-1990s, Russia was coming ou o he So ie Union. This c isis ha med
he coun y. The public did no ha e sa ings o he necessi ies o li e, and he Cen al Bank o Russia
con on ed a huge budge de ici and capi al de alua ion. The in la ion a e was lowe ed o less han 50% in
1996, and Russia su i ed wi h in e na ional ese es h ough he issue o go e nmen pape s. Russia had a
s ong ex e nal cu en accoun , ising in e na ional ese es, and high deb se ice cos s. Du ing his ime,
Russia decla ed a suspension o deb paymen s and p i a e ex e nal paymen s and eco e ed e y quickly by
way o inc easing oil and gas p ices.
. La in Ame ican Deb C isis 1995: This c isis has been el many imes in he pas 200 yea s. The i s
c isis was in 1826, ollowed by 1828, 1873, 1890, and 1931. In he 20 h cen u y, he majo c ises we e 1982—
Mexico's de aul ; la e , in 1994–95, he Tequila c isis; 2001–02, A gen ina’s de aul ; 1999–2003, he B azil
c isis; and majo ones in he 2008–09 GFC. In 1995, Mexico app oached he IMF and ob ained 17.8 billion
USD based on a s andby a angemen . This conside able und was no assigned by he IMF ea lie o any
c isis. Due o building con idence o he IMF membe s, he i s alloca ion was made o suppo he inancial
sys ems o membe coun ies.
g. The G ea Recession o 2008–09: This c isis was widesp ead in he U.S. and Eu ope, and i
exace ba ed he deepes slump in he wo ld economy. Regula o y ailu es and mac oeconomic policies a e
p ejudiced by imbalances in inancial housing and commodi y ma ke s. Be o e his c isis, he e we e 11
companies wi h inancial asse s o mo e han 350% o he g oss domes ic p oduc and 25 coun ies whose
inancial ma ke s we e he same by 2007. Asse s ose om 12 USD illion o 196 USD illion du ing 1980–
2007 (McKinsey Mapping Global Financial Ma ke s, Oc obe 2008). F om 1986 o 2006, co po a e p o i s
inc eased om 10% o 30%. While he ou s anding was inc eased o 116% in 2007 om 20% o GDP in 1980
(FED, 2009). Due o his , he in e na ional inancial sys em collapsed suddenly. O his, he U.S. GDP declined
by 4% in he las qua e o 2008. Wo ld GDP ell by 3.75% om 5% du ing 2007–08, and his was educed o
2% in 2008–09. The IMF es ima ed loan losses du ing his pe iod a 1.5 illion USD. The Lehman B o he s
collapsed in Sep embe 2008. The commodi y p ices we e educed, and oil p ices weakened by 50%, including
ood and o he commodi ies. Fo eco e y om he c isis, 2.5 illion USD was con ibu ed by he US and
Eu opean Cen al Banks. In he same way, he US go e nmen ins uc ed he pu chase o isky asse s using
public unds, and Eu opean coun ies we e also o e ed se e al packages o manage hei inancial supe ision.
By 2009, he c isis had u ned economic g ow h in o a posi i e inclusi e ange using a ious mone a y and
iscal policies, p og ams, and sys ema ic melli luousness o mo e he economic g aph owa ds g ow h in he
o m o he ebound in commodi y p ices, he p oduc i i y o manu ac u ing ac i i ies, and he gain o consume
con idence in housing ma ke s. By 2010, he expec ed ou come o wo ld GDP was 4.25%. I may be concluded
ha se e al e o ms and epai s o he inancial sys em a e equi ed o ad ance economies. This was aken up in
subsequen yea s. The In e na ional Labo O ganiza ion (ILO) o ecas s ac oss he globe ha unemploymen
will inc ease by 30 million o 50 million people du ing 2007–09. The condi ion will con inue; his igu e ose o
200 million people in de eloping coun ies h own in o po e y (Recommenda ions o he Uni ed Na ions
Commission o Expe s on Re o ms o he In e na ional Mone a y and Financial Sys em, Ma ch 2009, p. 2).
h. The Eu opean C isis 2010: This c isis, in 2010, sp ead ac oss Eu ope. The a ali ies we e in G eece,
I eland, Po ugal, and Cyp us. This c isis is due o public and p i a e balance shee imbalances wi hin he
Eu ozone. The a ing agencies we e gi ing poo a ings o banks due o an inc ease in non-pe o ming loans. In
his c isis, G eece was gi en w ong epo ing abou iscal da a o ge ing o eign bo owing. Fo his, he IMF
An empi ical e alua ion o he e ec s o in e es a es and he inancial c isis on he global ..
www.ijeijou nal.com Page | 154
unde s ands ha a angemen s o 28 billion eu os and a bila e al p og am wi h he assis ance o 15 associa e
eu o coun ies will p o ide inancial assis ance om he capi al o he Eu opean Cen al Bank. Apa om
unde - eco e y, he e was a need o addi ional p og ams in 2012, and G eece go 30 billion eu os om he
IMF. G eece will eco e om he c isis. G eece needs a big, sus ained adjus men p og am o educe he iscal
de ici , educe he deb a io, and s eng hen compe i i eness. The c isis a ec ed I eland, as he I ish banking
sec o and Po ugal had he lowes pe capi a income in his c isis. In 2010, Po ugal was a ec ed by low
balances in he cu en and iscal accoun s. To eco e his hi s y liquid posi ion, 26 billion eu os we e
bo owed om he IMF in he o m o collec i e con ibu ions by in e na ional pa ne s.
i. GFC on COVID-19: In COVID-19, he subs an ial inancial c isis was he 2020 s ock ma ke c ash.
This was p ima ily abou 20–30% o he indices ha ell be ween Feb ua y and Ma ch o 2020. By Oc obe
2020, mo e han 10 million unemploymen cases will ha e been no ed in he U.S. In Ma ch, he inancial
ma ke s we e educed 18 imes due o bad news pe cei ed in he ma ke s. Du ing his ime, he e we e inc eases
in daily consume goods, a decline in indus ial p oduc ion along wi h se ices, and a low u nou in he s ock
ma ke . The majo coun ies we e se ed due o hei ese es, while small coun ies we e pushed in o ecession
o e en dep ession.
The capi al ma ke in India has a long his o y, da ing back o e 100 yea s. Bo h ma ke s (deb and
equi y) mobilize esou ces om sa e s and use s o issuing companies o a ious p oduc i e pu poses. The
olume o unds and in e media ion p ocess is o he p edic ion o economic g ow h a e, capi al
accumula ion, and p oduc i i y by Ca lin and Maye (20033. In he U.S.A., he ini ial issue ma ke is ib an
due o he s a o new companies wi h new echnologies. A g owing economy needs isk and pe manen capi al
esou ces in deb and equi y. The e o e, a sus ainable economy is dependen on a ib an capi al ma ke .
Table 2: The in o ma ion on he US In e es a e % and he Global s ock index
Yea
ones-DJIA-100 bal
S ock Ma k
U.S In e es Ra e %
1950
2648.57
5.9
1951
3046.85
6
1952
2960.43
0.8
1953
3191.92
0.8
1954
3422.68
-0.7
1955
4655.01
0.4
1956
5820.29
3
1957
5375.18
2.9
1958
4785.16
1.8
1959
6316.15
1.7
1960
6361.98
1.4
1961
6888.09
0.7
1962
6683.24
1.3
1963
7138.24
1.6
1964
7984.88
1
1965
8616.67
1.9
1966
8740
3.5
1967
8221.46
3
1968
8044.87
4.7
1969
7940.65
6.2
An empi ical e alua ion o he e ec s o in e es a es and he inancial c isis on he global ..
www.ijeijou nal.com Page | 155
1970
6238.21
5.6
1971
6858.74
3.3
1972
6974.98
3.4
1973
6411.31
8.7
1974
5288.26
12.3
1975
4421.47
6.9
1976
4686.41
4.9
1977
4686.41
6.7
1978
3974.76
9
1979
3673.51
13.3
1980
2975.64
12.5
1981
3441.27
8.9
1982
2641.09
3.8
1983
3773.02
3.8
1984
3444.35
4
1985
3611.59
3.8
1986
5070.28
1.1
1987
6236.49
4.4
1988
5265.77
4.4
1989
5959.92
4.7
1990
6251.36
6.1
1991
6547.44
3.1
1992
7046.92
2.9
1993
7221.85
2.8
1994
7576.92
2.7
1995
8629.58
2.5
1996
10883.75
3.3
1997
12482.28
1.7
1998
16455.64
1.6
1999
19690
2.7
2000
19009.75
3.4
2001
18410.47
1.6
2002
17655.49
2.4
2003
13163.04
1.9
2004
16504.07
3.3
2005
15890.12
3.4
2006
17118.91
2.5
2007
18247.37
4.1
2008
17425.57
0.1
2009
11623.23
2.7
2010
15323.99
1.5
2011
17281.42
3
An empi ical e alua ion o he e ec s o in e es a es and he inancial c isis on he global ..
www.ijeijou nal.com Page | 156
2012
17466.32
1.7
2013
18995.84
1.5
2014
21131.64
0.8
2015
22871.55
0.7
2016
22536.98
2.1
2017
25705.05
2.1
2018
29309.38
1.9
2019
30932.92
2.3
2020
28800.99
1.4
2021
38481.83
2.5
Table:2: The in o ma ion on he US In e es a e % and he Global s ock index
Sou ces: F om he websi e- Dow Jones-DJIA-100 Yea -Global S ock Ma ke
Table 2 p o ides da a o he global s ock index and US in e es a e pe cen ages du ing 71 yea s. Based on he
accessibili y o he sou ces, speci ic da a om 1915 o 1951 has no been p o ided. The la es wo ldwide
in e es a e was no ye a ailable, pa icula ly o he yea 2022.
MARY OUTPUT
Reg ession S a is ics
R 0
0
R Squa e 0
E o 2
ions
d SS MS F Signi icance F
n 74 7 1 0.
48 6
55
Coe icien s S anda d E o S a P- alue
4 0. 9 7
le 1 - 3. - 0
The abo e analysis clea ly indica es ha he e is a ela ionship be ween in e es a es and he global
ma ke index because he signi ican alue is less han ‘p’ alues i.e., 0.00158.
IX.RECOMMENDATIONS OR SUGGESTIONS FOR THE FUTURE:
I may be sugges ed ha du ing a ecession, he go e nmen will be ale and ake ans o ma ional
policies such as e iewing egula ions o indus ies, p o ec ing wo ke s, and aking social secu i y measu es. In
imes o ecession, hose coun ies ha a e acing inancial c ises need suppo om he Wo ld Bank, which is
he In e na ional Mone a y Fund. In his way, du ing he Suez Canal c isis and in e na ional deb c ises, he
Wo ld Bank suppo ed he ic im coun ies. In a simila way, in a inancial c isis, he de alua ion o he ic im
coun y's cu ency. A such a ime, he inancial ins i u ions will decide o mobilize he unds h ough he issue
o sho - e m deb o p o ec agains he inancial c isis in ha coun y. I may also sugges ha du ing a
ecession, hose coun ies ha a e su e ing om c ises bu ha e ex e nal o in e na ional ese es based on
go e nmen pape s will bo ow o mee hei equi emen s, which will be co e ed wi h he help o inc easing oil
and gas p ices. Finally, i is also sugges ed ha hose coun ies a e inancially s ong enough o bo ow o a
sho pe iod o ime, issue bonds, and mobilize unds om he bo owe s o pay in e es income o hem. The
analysis explo es he posi i e ela ionship be ween in e es a es and he global ma ke index. In he same way,