When You’ve Seen One Financial Crisis…
14 Pages Posted: 15 Nov 2009
Date Written: September 1, 2009
Financial market crises may differ, but severe banking crises typically share many common features. The most recent crisis shares many features with the US Savings and Loan crisis of the 1980s and early 90s as well as some features of the LTCM crisis of 1998. More generally, banking crises are commonly associated with real estate market collapses. Effectively reducing the risk of future crisis requires some combination of reducing the potential size of real estate market collapses and the banking sector’s exposure to real estate losses.
Keywords: financial crisis, banking crisis, bubbles, real estate, financial regulation, regulatory reform
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