A PowerPoint presentation, Mortgage Crisis led to Credit and Illiquidity Crisis, delineates the key factors which the author believes enabled the contagious-but-confinable risks of the mortgage crisis to spread to the entire financial market. The prime cause was the weakened health of leveraged...

This article uses a crisis index based on an average of the variations in currency and financial crises indicators, referred to as “twin crises”, adjusting them to the same volatility. Thus, the objective is to measure the degree of vulnerability to twin crises within a group of 19 countries...

This article takes a look at the well known economical and financial crisis, which affected all the countries in the world. When comes to Europe, the most affected countries were the Baltic countries: Estonia, Latvia and Lithuania. The economy of these countries shrank enough, so that they cope...

The government support of financial firms through direct assistance and programs to improve market liquidity during the worldwide financial crisis of 2007-2008 is unprecedented since the Great Depression. Whether a given firm is ex-ante ‘Too Big To Fail' in the mind of government agents is not...

The Mexican crisis of 1994-95 had strong spillover effects on Argentina. The Argentine government successfully announced a series of policies to mitigate the contagion effects. This paper studies how capital markets reacted to each policy announcement and news. Capital markets welcomed...

This paper examines the determinants of economic and financial linkages between developed and developing countries, with special focus on East Asia. The synchronization of business cycles depends upon trade flows, production structures, and to a lesser extent, capital account openness. The...

This paper endogenizes financial contagion and financial crises from financial institutions. We show that financial crises can emanate from financial institutions which generate soft-budget constraints (SBC). The prevailing SBC in an economy distort information such that the interbank lending...

Collapsing credit markets have been blamed for the depth and persistence of the Great Depression in the United States. Could similar mechanisms have played a role in ending the East Asian economic miracle - and in creating fragility in global financial markets? After a brief account of the...