Global Financial Crisis (GFC) and Its Implication on COVID-19 Pandemic Crisis

We know from the research into Global Financial Crisis (GFC) in 2008 that the root causes of the crisis were invariably viewed from the three perspectives, namely (a) increasing global imbalances (capital flows), (b) monetary policy that might have been too relaxed, and (c) poor supervision and regulation. However, what remains poorly understood is the interplay between financiers, bankers, and the institutional and structural context. This study examines the interactions between financiers, bankers, and the institutional and structural context and how they engendered financial crisis and the implication of GFC to the COVID-19 pandemic crisis. The literary study was deployed to answer these questions. The findings showed that, firstly, institutional pressures and specific profit opportunities had been conceived in the financial markets and then shaped the risky behaviour of the bankers. Secondly, structural pressures conceived in a ‘systemic risk’ in financial markets promoted the scale of the financial crisis, and thirdly, the COVID-19 pandemic is different from GFC, the pandemic crisis exerting a more radical and sudden effect. It has placed the real economy out of action immediately and wholly – evaporating supply and demand concurrently.