Abstract
This paper examines the reasons behind the financial crisis of 2008, its effects, and the subsequent developments. At that time, the federal government's monetary policy promoted subprime loans, and credit default swaps were derived based on subprime loans. This series of reasons led to a huge bubble in the real estate market and directly caused the subprime mortgage crisis. Companies are closing one after another, unemployment and inflation are rising, and people's lives are getting more complex. To survive this crisis, the government passed pertinent legislation to support economic growth, and banking regulators corrected these laws to stop a repeat of the subprime mortgage crisis. Nowadays, the outbreak of the COVID-19 epidemic and the conflict in Ukraine have brought the world economy into trouble again. As a result, the 2008 financial crisis study is crucial to understanding modern society because it can be used to prevent future financial crises and effectively address economic problems.
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