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 fear that the value of those assets will drop if they remain in a financial institution other situations that may be labeled a financial crisis include the bursting of a speculative financial bubble a stock market crash a sovereign default or a currency crisis a financial crisis may be limited to banks or spread throughout a single economy the economy of a region or economies worldwide 