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At present Venezuela has the largest oil reserve capacity I.e 303 billion barrel oil reserve 18% of the total world’s oil reserve. There was a time when Venezuela was considered as one of the top 20 richest countries in the world. So what happened then? Why at present time it is among top 20 poorest countries in the world? In 1999, Hugo Chavez became the president of Venezuela who was very kind hearted person and mostly focused on social welfare. From 1999 oil prices started rising and went up to $100 per barrel. Oil was the main source of income for Venezuela. Their 95% revenue was from the oil business.   Most of the revenue from the oil was used by the government in social welfare programmes. When they faced any crunch of money, they used to borrow it from Russia and China. As they were earning huge revenue from oil business, they didn’t face any difficulties in importing. In return China took oil less than the market price from Venezuela. In 2013, after the death of Hugo C...

Harshad Mehta Scam  is considered as one of the biggest stock market scams in the world. The amount involved in the scam was around Rs.5000 crores . It is also known as The  1992 Indian Stock Market Scam. This scam was basically carried through Ready Forward Deal . Here, the banks issued loan from the other bank by keeping their Govt. securities as mortgage. And within the decided time period they repay the money and get back their securities. Thus, the Govt. securities were used by banks to get short term loans. The securities were usually sold and purchased through Receipts by banks. In ready forward deals, the broker acts as the mediator for buying and selling of securities. Harshad was also a broker and use to do this business. There were some loopholes in the RF deal, which Harsad Mehta knew very well.   And he started using those loopholes to do the fraud. So, what happened is…. Suppose there are 3 Banks A, B, C When Bank A wants to sell the securities, H...

The 2008 financial crisis also known as  Sub-Prime crisis ,  Global financial crisis  was the worst ever crisis after the  Great Depression of 1929 . The impact of the crisis had affected the whole world. Many big companies like  Lehman Brothers  collapsed due to the crisis.  In the year 2001 the interest rates went down to 1% and due to the implications of dot com bubble burst the share prices were continuously falling in the stock market, which discouraged the investors to park their funds in banks as well as to invest in stock market. At that time real estate sector was doing extremely well, and The U.S Govt. was also encouraging the people to buy houses and properties. As the interest rates were low, people started buying the houses by financing through loan from banks. Due to increasing demand of houses, the prices kept on rising and  thus attracting more investors to invest their funds.  Investment banks  were largely attracted see...