positionmarch3 - MikeLiao 83381880

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Mike Liao 83381880 In the article written by Olivier Blanchard, The Crisis: Basic Mechanisms, and Appropriate Policies , the idea of the paper is to express and look beyond the complexity of the global financial and economic crisis, but to identify the basic mechanisms and policies needed to resolve the crisis, and reduce the possibility of similar events in the future. The article starts off stating how it is “too early to give a definitive assessment of the crisis” however it is not too early to think about the basic mechanisms and whether how we can prevent similar events in the future. The article inquires one main question: how could such a small trigger have such enormous effects on the world output? There are 4 components leading to the answer of this question: 1) initial conditions 2) two amplification mechanisms 3) interconnections and dynamics and 4) implications for policy now and in the future.
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This note was uploaded on 03/14/2009 for the course ECON 161B taught by Professor Branch during the Spring '05 term at UC Irvine.

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positionmarch3 - MikeLiao 83381880

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