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dc.contributor.authorFernandez, Luisaen_US
dc.contributor.authorKaboub, Fadhelen_US
dc.contributor.authorTodorova, Zdravkaen_US
dc.date.accessioned2010-05-14T11:09:20Z-
dc.date.available2010-05-14T11:09:20Z-
dc.date.issued2008en_US
dc.identifier.urihttp://hdl.handle.net/10419/31596-
dc.description.abstractThe paper uses Minsky's financial instability hypothesis as an analytical framework for understanding the subprime mortgage crisis and for introducing adequate reforms to restore economic stability. We argue that the subprime crisis has structural origins that extend far beyond the housing and financial markets. We further argue that rising inequality since the 1980s formed the breeding ground for the current financial markets meltdown. What we observe today is only the manifestation of the ingenuity of the market in taking advantage of moneymaking opportunities, regardless of the consequences. The so-called democratization of homeownership” rapidly turned into record-high delinquencies and foreclosures. The sudden turn in market expectations led investors and banks to reevaluate their portfolios, which brought about a credit crunch and widespread economic instability. The Federal Reserve Bank’s intervention came too late and failed to usher in adequate regulation. Finally, the paper argues that a true democratization of homeownership is only possible through job creation and incomegeneration programs, rather than through exotic mortgage schemes.en_US
dc.language.isoengen_US
dc.publisherThe Levy Economics Inst. of Bard College Annandale-on-Hudson, NYen_US
dc.relation.ispartofseriesWorking papers // The Levy Economics Institute 548en_US
dc.subject.jelB52en_US
dc.subject.jelB58en_US
dc.subject.jelE12en_US
dc.subject.jelE44en_US
dc.subject.jelB52en_US
dc.subject.jelG21en_US
dc.subject.jelG24en_US
dc.subject.ddc330en_US
dc.subject.keywordMinskyen_US
dc.subject.keywordfinancial instabilityen_US
dc.subject.keywordWall Streeten_US
dc.subject.keywordsubprime mortgagesen_US
dc.subject.keywordreal estateen_US
dc.subject.keywordfull employmenten_US
dc.subject.keywordinequalityen_US
dc.titleOn democratizing financial turmoil: a Minskian analysis of the subprime crisisen_US
dc.typeWorking Paperen_US
dc.identifier.ppn58508811Xen_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungen-
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