Financial Crises and the Challenges for Future Research
5 Pages Posted: 12 May 2010
Date Written: April 1, 2010
Abstract
The main causes of the crisis could be ascribed to the global liquidity equilibrium, political interference in the credit market, bank credit standards, securitization and credit ratings. In order to better understand the crisis development and effects, the infectious leverage and the role of the financial innovation had to be considered.
When house prices grow and financial intermediaries work in a competitive environment, a financial crisis will be more probable and so a better supervisory approach is necessary.
Keywords: Financial crisis, Infectious leverage, Financial innovation
JEL Classification: G01, G21, G28
Suggested Citation: Suggested Citation