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The Global Financial Crisis: Some Special Features, Possible Responses

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  • Cristina Tănăsescu

    (Lucian Blaga University in Sibiu)

Abstract

The global financial crisis has now moved from containing the contagion to coping with the global recession. This paper identifies some special characteristics of the current recession. First, it began as a crisis of debt and of asset price inflation. Second, it represents a regulatory crisis. The explosion of complex (and unregulated) financial instruments in a high debt environment exacerbated the crisis of debt. Following immediately from this and, third, it represents a massive imbalance in the global economy and a credit crunch. Forth, it represents a collapse of demand and, following from that rising unemployment. Finally, the rising unemployment exacerbates the debt crisis. This completes a vicious cycle. This paper, also, explains the crisis in the view of Kondratieff cycle. It identifies also some possible response to the financial crisis.

Suggested Citation

  • Cristina Tănăsescu, 2009. "The Global Financial Crisis: Some Special Features, Possible Responses," Romanian Economic Business Review, Romanian-American University, vol. 4(3), pages 97-102, September.
    • Handle: RePEc:rau:journl:v:4:y:2009:i:3:p:97-102
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    References listed on IDEAS

    as
    1. Carmen M. Reinhart & Kenneth S. Rogoff, 2009. "The Aftermath of Financial Crises," American Economic Review, American Economic Association, vol. 99(2), pages 466-472, May.
    2. Reinhart, Carmen M. & Rogoff, Kenneth S., 2013. "Banking crises: An equal opportunity menace," Journal of Banking & Finance, Elsevier, vol. 37(11), pages 4557-4573.
    3. Wim Naudé, 2009. "The Financial Crisis of 2008 and the Developing Countries," WIDER Working Paper Series DP2009-01, World Institute for Development Economic Research (UNU-WIDER).
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