1. Equity reorganization, capital increase and share expansion. The government restructured financial institutions in crisis and increased capital and shares. For example, the United States nationalized the two companies, turning private enterprises into state-controlled enterprises.
2. Pack up bad debts and cut and strip them. Strip off the bank's bad debts, package them and put them aside. After the bank recovers, the funds will be redeemed. If the bank fails, the government will foot the bill and clear the bad debts.
3. Inject funds to solve liquidity. When banks are in a liquidity crisis and people run on them, funds are injected to increase cash flow. Either the government will provide a guarantee to enhance social confidence; or the government will provide a guarantee to allow other banks to lend.
Extended information:
The impact of the financial crisis
The impact of the financial crisis on the world economy is far-reaching. Data provided by the Institute of Finance of the Chinese Academy of Social Sciences show that the current market size of subordinated bond derivative contracts has been enlarged to nearly 400 trillion US dollars, which is equivalent to 7 times the global GDP.
Japanese media reported that the crisis will cause global financial assets to shrink by US$27 trillion. Former Federal Reserve Chairman Greenspan wrote: "One day, people will look back today and rate the current financial crisis in the United States as the most serious crisis since the end of World War II." The impact of the crisis on the real economy has now emerged, and the world economy has declined by several degrees. It’s a foregone conclusion.
China is the least damaged developing country in this crisis. The direct losses are relatively small, but the indirect effects cannot be underestimated. Exports will decrease, and as one of the troikas that drive economic growth, its role will begin to weaken; investors' confidence has been shaken, and investment enthusiasm is low; banks are "reluctant to lend" and domestic liquidity is insufficient.
Baidu Encyclopedia-Financial Crisis