![]() Minsky says in his book Stabilizing the instable economy: "The Economic instability so evident since the late 1960s is the result of the fragile financial system that emerged from cumulative changes in the financial relations and institutions over the years following World War II" (Minsky, 1986). But identifying Ponzi finance is not the most important contribution Minsky has made to our understanding of the logic of repeated financial crises under capitalism (Kregel, 2008). He is described as the "obscure economist" who identified highly speculative "Ponzi Finance" as an underlying factor in such crises. Some of them called this situation a "Minsky moment" (Whalen, 2007 Magnus, 2007). Many commentators are of the view that Minsky accurately anticipated the current financial crisis (Wray, 2008 McCauley, 2008). The current tsunami in financial markets, which is believed to have been triggered by the collapse of the sub-prime housing market, has refocused the ideas of Hyman Minsky (1919-1996), a prominent member of the post-Keynesian school of economics. One thing is common in all crises: that "All Crises are Crises of Success" (Portes and Vines, 1997). There is no precise definition of "financial crisis", but a common view is that disruptions in financial markets rise to the level of a crisis when the flow of credit to households and businesses is constrained and the real economy of goods and services is adversely affected. Endogenous processes take place near the peak of the expansion phase of the business cycle, in particular, the deterioration of the financial condition of the business sector, which set the stage for a financial crisis (Wolfson, 1994). Palabras clave : hipotecas sub-prime, burbuja inmobiliaria, títulos respaldados por hipotecas, conductos, riqueza y desigualdad de ingresos.įinancial Crises are the result of the normal functioning of the economic and financial systems over the course of the business cycle. Este trabajo empírico pretende demostrar las causas que están en el corazón de la crisis y no han sido lo suficientemente discutidas. ![]() Se dice que fue una crisis aun más grande que la Gran Depresión de 1929 y se le califica como única toda vez que no se conoce otra que haya impactado al mundo de esta manera. La crisis financiera 2007-2009 inició con las hipotecas de alto riesgo del mercado inmobiliario, se extendió al sector financiero y, finalmente, al resto del mundo. Keywords: sub-prime mortgages, housing bubble, mortgage back securities, conduits, wealth and income inequalities.Įste trabajo busca explicar algunos de los factores principales detrás de la crisis financiera de 2007-2009, con especial énfasis en la burbuja inmobiliaria, en la rendición de cuentas en el sistema financiero de Estados Unidos y en cómo estos dos factores generaron y empeoraron la crisis. This paper would empirically prove the main causes which are right in the heart of the crisis and least discussed. This crisis is unique in this way and we haven't seen such a bigger impact world wide from any other crisis. Financial Crisis 2007-2009, which starts from the United States sub-prime mortgage market and spread to US financial sector and later on spread to the rest of world, is said to be an even bigger crisis than the Great Depression of 1929. This paper seeks to explain some main factors behind the Financial Crisis 20072009 with a special focus on the Real Estate Bubble and Transparency and Accountability Issues in US Financial System and how these two factors generated and worsen the crisis. Segunda versión recibida el 17 de mayo de 2012 ![]() * Department of Economics, University of the Punjab, Pakistan. How Real Estate Bubble and Transparency and Accountability Issues Generated and Worsen the Crisis
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