Anatomy of the Beginning of the Housing Boom Across U.S. Metropolitan Areas

We provide novel estimates of the location, timing, magnitude, and determinants of the start of the last U.S. housing boom. The last housing cycle cannot be interpreted as a single, national event, as different markets began to boom across a decade-long period, some of them multiple times. A fundamental factor, income of prospective buyers, can account for half of the initial jump in price growth, while expansion of purchases by underrepresented minorities cannot. The start of the boom also was financed conventionally, not by subprime mortgages. The latter's share did rise sharply over time, but only after a multi-year lag.

Penyebab dan Upaya yang Dilakukan Para Pemerintah Dunia Saat Krisis Global 2008

In this globalization era, economic integration is increasingly in line with information technology. In a very short period of time, the financial crisis that occurred in the United States quickly spread to other countries so that it developed into a problem that was quite serious which had the effect of economic finance. This 2008 crisis is a very bad global financial crisis in the past 80 years. The crisis that was initially experienced due to subprime mortgages in the United States turned out to affect the international world. Therefore, the country's leaders strive to minimize the crisis by holding a meeting attended by the G-20. The G-20 is a major economic group in the world.

VALUE AT RISK: SENSITIVITY TO DIFFERENT ASSET ALLOCATION STRATEGIES DURING RETIREMENT

There is a risk of extreme events in financial markets. This risk is often understated as we have seen in portfolios of subprime mortgages during the 2008 financial crisis. The goal of this study is to draw inferences about the cross-section of VaR estimates for different asset allocation funds. The study answers this question for 7 different asset allocations 100% stock (S), 100% T’bonds (B), 100% T’bills (or Cash), .4S+.4B+.2Cash, .6S+.4B, .8S+.2B, and .8S+.2Cash. Further, the present study determines that stock-bond-bill asset allocation over a five-year planning period which minimizes VaR while earning a minimum of 7% return is 72.3% stocks and 27.7% bonds.

Is the Nigerian Stock Market Efficient? Pre and Post 2007-2009 Meltdown Analysis

Efficient market hypothesis asserts movements in asset prices are due to significant changes in information. The financial crisis of 2007-2009 originated from subprime mortgages in the United States and affected African countries through local stock markets. This study evaluates the Nigerian stock market efficiency in the pre and post financial meltdown of 2007-2009. GARCH models under three error distributional assumptions were used. The data covers January 2010 to December 2016 divided into pre and post meltdown. Findings indicate that in the pre and post meltdown, the Nigerian stock market is inefficient in the weak form while using the meltdown as event window, the market is efficient in the semi-strong form. It was recommended that prompt release of financial information by quoted firms should be on-line real time and mandatory to discourage rumour and speculative activities. Authority should not only spell out punishments but should be strict and firm about it.

Securitization and the Financial System

Mortgage securitisations rose rapidly in the early 2000s through the private label securitisation vehicles that packaged subprime mortgages. The size of the asset-backed securities sector in the United States traces well the overall leverage of the financial system in the run-up to the Great Financial Crisis.

The art of unpayable debts

This chapter explores a dialectics of what the author terms unpayable debts that define the current financialized global capitalist paradigm. On the one hand, these are the widely acknowledged and profoundly influential debts of individuals, institutions and nation-states which are unlikely or impossible to repay, from subprime mortgages to the sovereign debt of nations like Greece (or even the US for that matter). On the other hand, unpayable debts refers to those unacknowledged, silenced or purposefully ignored debts for the atrocities and injustices that helped create this current financialized order, including reparations for the transatlantic slave trade, restitution of stolen Indigenous lands and recompense for colonial pillage and subjugation. These latter unpayable moral and political debts must be silenced, ignored or deligitimized in order for the former unpayable fiscal debts to have such power. To explore these tensions the author provides a contextual and aesthetic reading of three interventionist and performative public artworks: English artist Darren Cullen’s “Pocket Money Loans” (2012-present), Argentine artist Marta Minujín’s “Payment of Greek Debt to Germany with Olives and Art” (2017), and Anishinaabe artist Rebecca Belmore’s “Gone Indian” (2009).

Penyebab Krisis Finansial Global tahun 2008: Kegagalan Financial Development dalam Mendorong Pertumbuhan dan Stabilitas Ekonomi

The Global Financial Crisis has raised questions for economists on the causes of the issue and how to prevent similar case in the future. One of the causes of the crisis was a large and rapid increase of credit accumulation in the United States (US) on the period of 2000 to 2007. While according to the theory of Financial Development, credit is one of the indicator that shows the ongoing national financial system. Credit includes the access get credit and the ability of financial institution to lend credit. Both can be seen in the United States, proved by the ease of access to home loans and increasing amount of subprime mortgages. In accordance with the theory of financial development, the US economy should had experienced growth and stability. However, the rapid increase of credit accumulation in US has led to instability and crisis. The anomaly proves the failure of Financial Development and encourage the International Monetary Fund (IMF) to review the theory and prove its relevance in explaining economic growth and stability.

SUBPRIME MORTGAGES AND LENDING BUBBLES

We consider a model with two types of households; the poor with no initial endowment and the rich with positive endowment; and two types of assets; properties in a poor area and properties in a rich area. In the model, poor agents need credit to buy an asset whereas the rich can draw from their endowment. We show that credit-fuelled housing bubbles sometimes may improve welfare, making the poorer individuals better-off. More precisely, there exist two types of equilibria in both markets: One is a bubble equilibrium, and the other is an equilibrium where asset prices are stable over time. While the poor always obtain a positive surplus in the bubble equilibrium, this is not necessarily true for the rich. Our results suggest that there may be scope for market interventions aimed at sustaining the value of assets held by credit-constrained agents after the burst of a credit bubble.