Reasons, consequences, and prevention possibilities of financial crises

Abstract

The subject of this research is many conditions that contribute to the emergence of crisis phenomena in the financial and economic spheres. The purpose of the article is to study the causes, consequences, and prevention possibilities of financial crises. Among the methodology used, it is necessary to distinguish the analysis of internet-resources corresponding to the subject of the study, their synthesis and generalisation. The detailed analysis of the concept and causes of financial crises, systematisation of information about the possibilities of their avoidance are the main results of the conducted research. The obtained results can be applied in the development of methodologies and recommendations for the prevention of financial crises with consideration to the current situation as well as in the educational process. The prospects for further research on a given topic include: determination of the dynamics and specifics of the development of financial crises, the main development stages, formulation of forecasts about their occurrence in various economic sectors. In conclusion, we will note that, firstly, financial crises represent one of the integral stages of the development of economic relations both in a single country and in the whole world. Secondly, the causes of financial crises may be explained by using a certain theoretical framework with consideration to modern phenomena and, as a rule, are the result of the introduction of new tools, methods ,and ways of management. Thirdly, in order to increase the effectiveness of leveling the negative impact of financial crises, it’s important to apply the integrated approach which includes the implementation of preventive measures not only within the country, but also at the company level.