A financial crisis is a situation in which the value of financial institutions or assets drops rapidly, leading to widespread economic instability. It often results from the failure of financial institutions, significant asset price declines, or a loss of confidence in the financial system. During a financial crisis, banks may face liquidity issues, markets can become illiquid, and credit may become difficult to obtain. Such crises can trigger severe economic downturns, unemployment increases, and can affect numerous sectors within the economy. Financial crises can be caused by various factors, including excessive debt, speculative bubbles, poor financial regulation, and systemic risks within the financial system. They are often characterized by stock market crashes, bank runs, and declines in consumer and business confidence, prompting government and central bank interventions to stabilize the economy.
### Caution Sign for Investors The financial scene is heating up as a surge in various risk assets prompts concerns from prominent strategist Michael Hartnett regarding a possible bubble. Recently,…