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Past financial crises, the current financial turmoil, and the need for a new macrofinancial stability framework

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  • White, William R.

Abstract

While it is tempting to focus on new financial innovations in helping explain recent financial turmoil, more traditional causes should not be overlooked. As on many previous occasions, very rapid credit growth led to major increases in asset prices, which in turn encouraged consumption and investment decisions which could yet prove unsustainable. The natural "procyclicality" of the financial system could perhaps be contained through the introduction of a "new macrofinancial stability framework". There are many practical impediments to realising such a suggestion, but there are also grounds for belief that these impediments could be removed.

Suggested Citation

  • White, William R., 2008. "Past financial crises, the current financial turmoil, and the need for a new macrofinancial stability framework," Journal of Financial Stability, Elsevier, vol. 4(4), pages 307-312, December.
  • Handle: RePEc:eee:finsta:v:4:y:2008:i:4:p:307-312
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    Cited by:

    1. Duca, John V. & Muellbauer, John & Murphy, Anthony, 2010. "Housing markets and the financial crisis of 2007-2009: Lessons for the future," Journal of Financial Stability, Elsevier, pages 203-217.
    2. Honkapohja, Seppo, 2014. "Financial crises: Lessons from the Nordic experience," Journal of Financial Stability, Elsevier, pages 193-201.
    3. Krzysztof Olszewski, 2013. "The Commercial Real Estate Market, Central Bank Monitoring and Macroprudential Policy," Review of Economic Analysis, Rimini Centre for Economic Analysis, vol. 5(2), pages 213-250, December.
    4. repec:mes:emfitr:v:53:y:2017:i:11:p:2585-2608 is not listed on IDEAS
    5. Casu, Barbara & Clare, Andrew & Saleh, Nashwa, 2011. "Towards a new model for early warning signals for systemic financial fragility and near crises: an application to OECD countries," MPRA Paper 37043, University Library of Munich, Germany.
    6. Cukierman, Alex, 2011. "Reflections on the crisis and on its lessons for regulatory reform and for central bank policies," Journal of Financial Stability, Elsevier, pages 26-37.
    7. Kim, Jinyong & Kim, Yong-Cheol, 2013. "Financial crisis and a transmission mechanism of external shocks: The signaling role of the Korean Monetary Stabilization Bond," Journal of Financial Stability, Elsevier, pages 682-694.
    8. Michaelides, Panayotis G. & Tsionas, Efthymios & Konstantakis, Konstantinos, 2016. "Financial Bubble Detection : A Non-Linear Method with Application to S&P 500," MPRA Paper 74477, University Library of Munich, Germany.
    9. Kent, Christopher John, 2011. "Two depressions, one banking collapse: Lessons from Australia," Journal of Financial Stability, Elsevier, vol. 7(3), pages 126-137, August.
    10. San-Martín-Albizuri, Nerea & Rodríguez-Castellanos, Arturo, 2012. "Globalisation And The Unpredictability Of Crisis Episodes: An Empirical Analysis Of Country Risk Indexes / La Imprevisibilidad De Los Episodios De Crisis: Un Análisis Sobre Los Índices De Riesgo País ," Investigaciones Europeas de Dirección y Economía de la Empresa (IEDEE), Academia Europea de Dirección y Economía de la Empresa (AEDEM), pages 148-155.
    11. repec:eee:phsmap:v:482:y:2017:i:c:p:95-107 is not listed on IDEAS
    12. Abudy, Menachem Meni & Raviv, Alon, 2016. "How much can illiquidity affect corporate debt yield spread?," Journal of Financial Stability, Elsevier, pages 58-69.
    13. VanHoose, David, 2011. "Systemic Risk and Macroprudential Bank Regulation: A Critical Appraisal," Journal of Financial Transformation, Capco Institute, vol. 33, pages 45-60.
    14. Cardarelli, Roberto & Elekdag, Selim & Lall, Subir, 2011. "Financial stress and economic contractions," Journal of Financial Stability, Elsevier, vol. 7(2), pages 78-97, June.
    15. Michaelides, Panayotis G. & Tsionas, Efthymios G. & Konstantakis, Konstantinos N., 2016. "Non-linearities in financial bubbles: Theory and Bayesian evidence from S&P500," Journal of Financial Stability, Elsevier, pages 61-70.
    16. Merike Kukk & Karsten Staehr, 2015. "Macroeconomic factors in corporate and household saving. Evidence from Central and Eastern Europe," Bank of Estonia Working Papers wp2015-5, Bank of Estonia, revised 30 Dec 2015.
    17. Michael Diemer & Uwe Vollmer, 2015. "What makes banking crisis resolution difficult? Lessons from Japan and the Nordic Countries," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 5(2), pages 251-277, December.

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