FINANCIALCRISISCLASS

FINANCIALCRISISCLASS - 1 Financial Crisis, etc Practical...

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Unformatted text preview: 1 Financial Crisis, etc Practical Macroeconomics Financial Crisis of 2007 Current 1 Controversy Krugman return of dep econ In the News? 2 Course Issues LAST CLASS Friday 12/10 o Investment Game, Suggestions Weds noon Extra Credit fri, post on assignments (attachment) FINAL EXAM How to study Review Guide, Essential Questions Chat Room, Study groups 3 Q&A Course Evals & Surveys (3) FINAL EXAM CONFLICTS see me NOW Finalexams.rutgers.edu Q&A Tues 12/14 1pm Sc 103 FINAL EXAM Thurs 12/16 noon Milledoler 100 2 Panics, Manias, Bubbles 1637 Tulip Mania speculative bubble Netherlands, tulip prices rose to 10x annual incomes, then collapsed 1720 South Seas Bubble, stock speculation in British stock company Company established to fund govt debt 10 fold increase in stock price in year John Law and Mississippi Bubble Scottish economist -became French Comptroller Generale First central bank of France 4 U.S. Crises Panic of 1893 - railroads, bank failures Panic of 1896 silver reserves Panic of 1901 NYSE crash robber barons clash Panic of 1907 bank failures, recession Wall Street Crash/Great Depression 1929 Speculative bubble in stocks, real estate, fed raises rates, depression 1987 Black Monday largest 1 day % decline in stock prices. Quick recover, Greenspan 5 More 1994 Tequilla Crisis Mexico 1997 Asian Financial Crisis 2001 Dot Com Bubble bursts 2007 Subprime Financial Crisis Always This time its different Mark Twain History may not repeat itself, but it sure does rhyme 6 3 Types and Causes Banking crises liquidity , no lender of last resort, mis-match of maturities of assets and liabilities (borrow short, lend long), solvency-speculative losses, leverage Speculative bubbles psychological, monetary policy International financial crises fixed exchange rates, hot money, speculative attacks 2007 ?2007 ?...
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FINANCIALCRISISCLASS - 1 Financial Crisis, etc Practical...

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