1. What Causes Subprime
Mortgage and Its Effect
Toward Caribbean?
GROUP NAME :
SANIA MIRZA
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2. What is Subprime Mortgage?
 According to Dell’Ariccia, Igan and
Laeven, (2009) Subprime mortgages
are unsafe to the creditors and
borrowers due to the combination of
high interest rates, bad credit
history, and not clear about
personal financial situations often
related with subprime applicants
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3. Subprime Mortgage in
United States 2007
New Model of Mortgage Lending
Source: BBC News 3

4. Causes Of Subprime Mortgage
Crisis
 Increase of housing bubble
 The Waning of the Housing Market
 The reckless and excessive lending
 Subprime lending
 The Central Banks Policy
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5. Effect Of Subprime Toward
Caribbean
 Trade
 Tourism
 Remittances
 Finance and Foreign Direct
Investment (FDI)
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6. Recommendations
 Analysis other industry for their highest
trades
 Maximize their comparative advantage
when it comes to their geographical
place
 Create a sustainable employment
opportunities
 The diversification of foreign reserves 6

7. Conclusion
 The subprime mortgage has been
caused by several reasons and
effected the Caribbean economy
and businesses operating.
 The regulatory bodies and central
banks also should plan a guiding
structure and a list of rules for
precautions.
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8. The End
Thank You
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