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Dutch Disease

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  Dutch Disease   A discovery or exploitation of a valuable natural resource that leads to an appreciation in the value of a country’s currency is usually perceived as a good thing. But do long-term repercussions from the same exist? Geologists have recently found huge lithium deposits in J&K and Rajasthan, whose value is estimated to be upwards of $410 billion. Can this discovery of ‘white gold’, if not for proper government intervention at the right time, prove to be paradoxically disadvantageous for the country? The term ‘Dutch Disease’ was coined by The Economist magazine back in 1977 following a publication analyzing a crisis that occurred in the Netherlands following the discovery of huge amounts of natural gas reserves and deposits in the North Sea. The term then became widely used in economic circles to describe the paradoxical situation in which seemingly good news negatively affects a country’s economy. Natural Gas reserves were discovered in the Nether...
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When Banks Fail: The Collapse of Silicon Valley Bank

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The second biggest bank collapse in U.S. History ? Global Bank Indices bleeding? And that is just the tip of the iceberg. The US Banking system is currently facing a crisis, unseen since the days of 'The Great Recession' . This has led to panic among the masses, worried about the safety of their deposits and fearful of a market-wide crisis fueled by a sectoral collapse of global banks. What are the major reasons responsible for the downfall of these banks? And what does the future hold for these distressed banks, capital markets and the general public? On Friday, 10th March 2023, Silicon Valley Bank, the then 16th largest bank in the US was shut down following a 48-hour frenzy. Just a day before this, the stock price of the bank recorded a 60% single day fall after which trading of the stock was halted. Silicon Valley Bank is the second largest bank to 'go under' since the Washington Mutual Bank. There are various reasons which contributed to the sudden and unexpec...
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