Extensive use of leverage
The investment banks began to borrow money and put it to work to sustain their profitabiltity.
Immediately related elementsHow this works
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The Global Financial Crisis Â»The Global Financial Crisis
Long-term causes of the financial crisis? Â»Long-term causes of the financial crisis?
Unintended consequences of earlier public policy choices Â»Unintended consequences of earlier public policy choices
Investment banks incentivised to move into riskier activities Â»Investment banks incentivised to move into riskier activities
Extensive use of leverage
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