Discuss some of the advantages of financial integration among states. Then, using the 2008-2009 global financial crisis, explain why financial integration may also be risky. In your explanation, focus on at least three of the primary negative effects of the 2008-2009 crisis.

What will be an ideal response?

The ideal answer should include:
1. Discuss the advantages of financial integration. For example, students might focus on investors' ability to access overseas markets, which in turn spurs economic growth, or the possibility of better returns on investments for individuals investing for retirement.
2. Explain why financial integration may be risky. For example, students may argue that an economic crisis in one state can quickly spread to another and then another, leading to a global crisis.
3. Discuss three of the negative effects of the 2008-2009 crisis. For example, students might write about many American homeowners' inability to pay back loans, the decrease in the value of homes in the United States, or American banks going to the edge of bankruptcy.
4. Offer a concise summary and effective conclusion.