An Overview of the Crisis: Causes, Consequences and Solutions

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dc.contributor.author ALLEN, Franklin
dc.contributor.author CARLETTI, Elena
dc.date.accessioned 2010-05-06T08:55:49Z
dc.date.available 2010-05-06T08:55:49Z
dc.date.issued 2009
dc.identifier.citation International Review of Finance, 2009, 10, 1, 1-26 en
dc.identifier.uri http://hdl.handle.net/1814/13895
dc.description.abstract What caused the crisis? Initially many thought that it was due to incentive problems in the U.S. mortgage industry. However, after the large economic meltdown following Lehman Brothers' bankruptcy in September 2008, it seems that much more was going on. We argue that there was a bubble in real estate prices in the United States and a number of other countries. The main causes of the bubble were loose monetary policy, particularly by the United States Federal Reserve, and global imbalances. The combination of cheap credit together with the easy availability of funds contributed to create the bubble. Many other factors such as subprime mortgages, weak regulatory structures, and high leverage in the banking sector exacerbated the effects of the crisis. We consider possible reforms aimed at minimizing the occurrence of future crises in the governance structure of central banks, measures to reduce global imbalances, and changes in banking regulation. en
dc.language.iso en en
dc.title An Overview of the Crisis: Causes, Consequences and Solutions en
dc.type Article en
dc.neeo.contributor ALLEN|Franklin|aut|
dc.neeo.contributor CARLETTI|Elena|aut|EUI70001


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