<P> It began in 2007 with a crisis in the subprime mortgage market in the United States , and developed into a full - blown international banking crisis with the collapse of the investment bank Lehman Brothers on September 15 , 2008 . Excessive risk - taking by banks such as Lehman Brothers helped to magnify the financial impact globally . Massive bail - outs of financial institutions and other palliative monetary and fiscal policies were employed to prevent a possible collapse of the world financial system . The crisis was nonetheless followed by a global economic downturn , the Great Recession . The European debt crisis , a crisis in the banking system of the European countries using the euro , followed later . </P>
<P> It began in 2007 with a crisis in the subprime mortgage market in the United States , and developed into a full - blown international banking crisis with the collapse of the investment bank Lehman Brothers on September 15 , 2008 . Excessive risk - taking by banks such as Lehman Brothers helped to magnify the financial impact globally . Massive bail - outs of financial institutions and other palliative monetary and fiscal policies were employed to prevent a possible collapse of the world financial system . The crisis was nonetheless followed by a global economic downturn , the Great Recession . The European debt crisis , a crisis in the banking system of the European countries using the euro , followed later . </P>
the financial crisis of 2008 was caused by
the financial crisis of 2008 was caused by
a crisis in the subprime mortgage market
a crisis in the subprime mortgage market