BANGALORE: The rise of entrepreneurship as the predominant economic system around the world has seen many people benefit from increased living standards and greater prosperity. But occasionally, it is a system that go0es wrong. And when it does go wrong, it can be spectacular.

Financial markets seem to possess a peculiar emotional element to them. They suffer from nerves, panic and irrationality. And if too many people get swept up by these emotions, it can lead to a crisis.

Here are five of the biggest financial crises of recent history:

1. The Great Depression

The Great Depression was considered as the longest and most severe depression in global economic history, lasting for virtually the entire period between 1929 and the outbreak of World War II. As a stark contrast to the roaring twenties, a period of prosperity and ostentatious wealth, the depression era created massive and almost instantaneous poverty.

The beginning of this period was marked by the Wall Street Crash, which remains the single-most devastating crash in U.S. stock market history. On October 29, 1929, $10 billion (around $95 billion today) turned to dust. For some, it took entire lifetimes just to break even from the losses made at this point.

The market became a hobby for many ignorant investors, who readily poured all their money into the stocks of companies that they didn’t understand. When the government raised interest rates, panic ensued. Investors were desperate to liquidate their stocks, but the money was no more there. Unfortunately, banks also invested in stocks and the panic led to a run on those banks that reduced many to insolvency and failure.