What Is a Financial Crisis? In a financial crisis, asset prices see a steep decline in value, businesses and consumers are unable to pay their debts, and financial institutions experience liquidity shortages. A financial crisis is often associated with a panic or a bank run during which investors sell off assets or withdraw money from savings accounts because they
What Was the Financial Crisis Responsibility Fee? The Financial Crisis Responsibility Fee was a proposed federal tax put forward by President Barack Obama in 2010. The tax would have been imposed on financial firms that received money from the Troubled Asset Relief Program (TARP) in order for the government to recoup every dollar spent on bailing
What Is Financial Economics? Financial economics is a branch of economics that analyzes the use and distribution of resources in markets. Financial decisions must often take into account future events, whether those be related to individual stocks, portfolios, or the market as a whole. Key Takeaways Financial economics analyzes the use and distribution of resources in markets.It employs economic theory
What Is Financial Elder Abuse? Financial elder abuse involves taking advantage of older people and unfairly benefiting from their monetary resources. Family members, business associates, caregivers, and strangers sometimes financially abuse elders by taking advantage of their trust. Tactics involved in financial elder abuse include the unauthorized use of an older person’s assets, gaining power
What Is Financial Engineering? Financial engineering is the use of mathematical techniques to solve financial problems. Financial engineering uses tools and knowledge from the fields of computer science, statistics, economics, and applied mathematics to address current financial issues as well as to devise new and innovative financial products. Financial engineering is sometimes referred to as
What Is Financial Health? Financial health is a term used to describe the state of one’s personal monetary affairs. There are many dimensions to financial health, including the amount of savings you have, how much you’re putting away for retirement, and how much of your income you are spending on fixed or non-discretionary expenses. Key
What Is a Financial Hub? A financial hub, also known as a financial center by the International Monetary Fund (IMF), is a city or region where a large number and a variety of financial services institutions are headquartered. The term hub is a metaphor, comparing the financial services industry to a wheel with a hub
What Is Financial Inclusion? Financial inclusion refers to efforts to make financial products and services accessible and affordable to all individuals and businesses, regardless of their personal net worth or company size. Financial inclusion strives to remove the barriers that exclude people from participating in the financial sector and using these services to improve their
What Is Financial Independence, Retire Early (FIRE)? Financial Independence, Retire Early (FIRE) is a movement of people devoted to a program of extreme savings and investment that aims to allow them to retire far earlier than traditional budgets and retirement plans would permit. The 1992 best-selling book Your Money or Your Life by Vicki Robin
What Is Financial Infidelity? Financial infidelity occurs when couples with combined finances lie to each other about money. For example, one partner may hide significant debts in a separate account while the other partner is unaware. Another common example is when one partner makes large discretionary expenditures without discussing the matter with their partner. Key
