The Global Credit Crisis of 2008: Causes and Consequences
AIIFL Working Paper No. 3
51 Pages Posted: 21 Jan 2009 Last revised: 21 Feb 2011
Date Written: January 1, 2009
This paper discusses the global credit crisis and its implications for international finance and financial regulation. It begins with a discussion of the causes of the credit crisis, particularly the role of regulatory incentives underlying excessive international and domestic borrowing, lending and investment. From this basis, the paper looks to the international responses to the crisis, focusing on the Financial Stability Forum and the Group of Twenty. In this context, it considers issues relating to systemic risk and financial stability, with particular attention to possible regulatory changes and their implications for international finance.
Keywords: financial crisis, financial regulation, Financial Stability Forum, capital adequacy, Group of 20, systemic risk
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