A financial crisis is a situation where the value of financial institutions or assets drops rapidly, leading to widespread economic instability. This can occur due to various factors, such as excessive debt, poor financial practices, or sudden market shocks. When a crisis happens, it often results in bank failures, stock market crashes, and a loss of consumer confidence. During a financial crisis, governments and central banks may intervene to stabilize the economy. They can implement measures like lowering interest rates or providing bailouts to struggling institutions. Historical examples include the 2008 financial crisis and the Great Depression, both of which had significant global impacts.