The sub-prime crisis refers to a specific event that occurred in the financial markets and is associated with the economic recession. It was a major factor that led to the global financial crisis of 2007-2008.

The sub-prime crisis primarily originated in the United States and was centered around the housing market. It involved the lending practices of financial institutions and the subsequent collapse of the housing bubble.

Here is a detailed explanation of the sub-prime crisis and its association with the economic recession:

1. Background:
- In the early 2000s, financial institutions started offering sub-prime mortgages to borrowers with low creditworthiness.
- These mortgages had higher interest rates and were considered riskier compared to prime mortgages.
- The demand for housing was high, and many borrowers were eager to own homes.

2. Lending Practices:
- Financial institutions relaxed their lending standards and offered loans to borrowers who would not have qualified for traditional mortgages.
- These loans were often given without proper verification of income and assets, leading to a higher risk of default.
- Many borrowers took on adjustable-rate mortgages (ARMs) that had low initial interest rates but would increase after a certain period.

3. Housing Bubble:
- The increased demand for housing and easy availability of credit led to a surge in home prices.
- Speculative buying and flipping of properties became common, further driving up prices.
- Homeowners believed that the value of their properties would continue to rise, and they could refinance or sell at a profit.

4. Burst of the Housing Bubble:
- As interest rates on ARMs started to reset, many borrowers found it difficult to make higher mortgage payments.
- The number of defaults and foreclosures increased, leading to an oversupply of homes in the market.
- Home prices began to decline, resulting in negative equity for many homeowners.

5. Financial Crisis:
- The collapse of the housing market had severe repercussions on the financial system.
- Financial institutions that had invested heavily in sub-prime mortgages suffered significant losses.
- These losses spread throughout the global financial system, causing a liquidity crisis and a loss of confidence among investors.

6. Economic Recession:
- The sub-prime crisis, along with other factors, triggered a global economic recession.
- Stock markets plummeted, credit markets froze, and many banks and financial institutions faced insolvency.
- The recession led to a decline in consumer spending, increased unemployment, and a slowdown in economic growth worldwide.

In summary, the sub-prime crisis was a major event that occurred within the financial markets and was associated with the economic recession. It originated from the lending practices and subsequent collapse of the housing market in the United States. The crisis had far-reaching consequences on the global economy and financial system, leading to a severe recession.