Learning Lessons: The Global Financial Crisis in Retrospect

Abstract

The main contribution of this paper is a Timeline of the Global Financial Crisis (GFC) from 1720 to 2015. It is accompanied by analysis in which I distinguish between the sufficient conditions for the GFC (the conjunction of many things which occurred before the GFC, which were correlated with the GFC, and perhaps influenced it) and the necessary conditions for the GFC (those things without which the GFC would not have occurred). Is it possible to distinguish between elements of the two sets? Avoiding unnecessary regulation in the future, while ensuring against a repetition, would suggest that one must strive to do so, for policy reasons, as well as for understanding the paths that led to the GFC. I conclude that three conditions were necessary for the financial crisis in the U.S., which, in turn, resulted in the GFC. All were failures of regulation.

Keywords: Global Financial Crisis, timeline, necessary and sufficient conditions, regulation