The Financial Crisis of 2008 was a severe worldwide economic downturn that began in the United States. It was primarily triggered by the collapse of the housing market, where many homeowners defaulted on their mortgages. Financial institutions had heavily invested in risky mortgage-backed securities, leading to significant losses and a loss of confidence in the banking system. As banks faced insolvency, the crisis spread globally, resulting in a credit freeze and a sharp decline in consumer spending. Governments and central banks intervened with bailouts and stimulus packages to stabilize the economy. The crisis highlighted the need for better regulation in the financial sector.