The 2007 Meltdown: A Legal Phenomenon

129 Pages Posted: 22 Jul 2013 Last revised: 29 May 2020

See all articles by Janos Nathan Barberis

Janos Nathan Barberis

The University of Hong Kong - Faculty of Law; Founders Taboo

Date Written: April 22, 2012

Abstract

This dissertation makes the argument that the Meltdown is a failure of regulation rather than capitalism. Consequently the gap, that legislators and the judiciary - supressed by executive activism - left, becomes unbearable. Secondly, it is submitted that bailouts are failed policies. For the first time, Game Theory has been used to demonstrate why bailouts were relied upon. Finally, this work will use law, alongside economics, as one of the tools to explain this and future financial crises. Economics has the ability to identify triggers of financial crises, whereas law indicates how a crisis may unfold. Thus, the use of both subjects is crucial in order to have a comprehensive understanding of a meltdown.

Keywords: Financial Crisis, European Debt Crisis, Meltdown, credit default swap, bailout, foreclosure, short sales, systematic risk, default risk, credit spread, CDS, CDO, disintermediation, defaults, consumer credit, credit supply, credit expansion

Suggested Citation

Barberis, Janos Nathan, The 2007 Meltdown: A Legal Phenomenon (April 22, 2012). Available at SSRN: https://ssrn.com/abstract=2296812 or http://dx.doi.org/10.2139/ssrn.2296812

Janos Nathan Barberis (Contact Author)

The University of Hong Kong - Faculty of Law ( email )

Pokfulam Road
Hong Kong, Hong Kong
China

Founders Taboo ( email )

1 Canada Square
London, E145AB
United Kingdom

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