Global Crisis
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University of Zimbabwe
FACULTY OF COMMERCE
DEPARTMENT OF BUSINESS STUDIES
Assignment question
Is FINANCIAL AND SUPERVISORY REGULATORY SYSTEM IN ZIMBABWE STILL APPROPRIATE
By
Edmore Mukushwa r095739q
Honours IN Bachelors BUSINESS STUDIES degree
Finance & BANKING
Course: CORPORATE BANKING (BSFM 404)
Lecture: Mr NHAVIRA
ABSTRACT
The period 2007-2009 etched a bleak abyss on the global financial landscape[1]. What started as financial engineering and cosmetic accounting in Lehman Brother’s Investments Department mutated into a cataclysm that deluged first the US economy and ultimately the global financial system.[2] Scholars, analysts and critics stood unsuspecting as what they all presumed to be just flimsy and ephemeral difficulties in the subprime mortgage market nichodemously manifested into devastating world financial crisis.[3] Whilst there is a considerably unquestionable unanimity as to the globalness of the 2007-2009 financial crises there exists a worrisome divergence of opinion and perception as to what really generated the crisis, what were the true costs and what were the optimal policy options to be adopted to salvage economies from the world financial albatross of 2007-2009.
Cognizant to this paramount reflection, this masterpiece is dedicated to recounting the causes of 2007-2009 financial crises, qualifying its global consequences and examining how the plethora of problems resultant had to be addressed especially by the Bank of International Settlements (BIS). The author will employ use of various models ranging from global vector auto-regression models (GVAR), causality tests and the correlation analysis to investigate the effects of this crisis on the domestic and global economy.
Key words. subprime mortgage market, financial engineering, world financial crisis.
1. INTRODUCTION……………………………………………………………...5 0. Background of the study and problem statement
University of Zimbabwe
FACULTY OF COMMERCE
DEPARTMENT OF BUSINESS STUDIES
Assignment question
Is FINANCIAL AND SUPERVISORY REGULATORY SYSTEM IN ZIMBABWE STILL APPROPRIATE
By
Edmore Mukushwa r095739q
Honours IN Bachelors BUSINESS STUDIES degree
Finance & BANKING
Course: CORPORATE BANKING (BSFM 404)
Lecture: Mr NHAVIRA
ABSTRACT
The period 2007-2009 etched a bleak abyss on the global financial landscape[1]. What started as financial engineering and cosmetic accounting in Lehman Brother’s Investments Department mutated into a cataclysm that deluged first the US economy and ultimately the global financial system.[2] Scholars, analysts and critics stood unsuspecting as what they all presumed to be just flimsy and ephemeral difficulties in the subprime mortgage market nichodemously manifested into devastating world financial crisis.[3] Whilst there is a considerably unquestionable unanimity as to the globalness of the 2007-2009 financial crises there exists a worrisome divergence of opinion and perception as to what really generated the crisis, what were the true costs and what were the optimal policy options to be adopted to salvage economies from the world financial albatross of 2007-2009.
Cognizant to this paramount reflection, this masterpiece is dedicated to recounting the causes of 2007-2009 financial crises, qualifying its global consequences and examining how the plethora of problems resultant had to be addressed especially by the Bank of International Settlements (BIS). The author will employ use of various models ranging from global vector auto-regression models (GVAR), causality tests and the correlation analysis to investigate the effects of this crisis on the domestic and global economy.
Key words. subprime mortgage market, financial engineering, world financial crisis.
1. INTRODUCTION……………………………………………………………...5 0. Background of the study and problem statement
References: 1. Franklin Allen and Elena Carletti (2009) Financial Crises: Theory and Evidence European University Institute. June 8, 2009 2 3. Gerald Swanson (1989), the Hyperinflation Survival Guide, Strategies for American Businesses. Figgie International. New York. 4. Michael Perelman (1999) The Natural Instability of Markets; Expectations, Increasing Returns and The Collapse of Capitalism. Saint Martins Press. New York 5 6. Jickling, M. (2009). Causes of the financial crisis (R40173). Washington, DC: Congressional Research Service. 9. BIS, 78th Annual Report, Basle, Bank for International Settlements, June 30th, 2008. 10. Blackburn R., “The Subprime Crisis,” New Left Review, n. 50, London, Mar./Apr. 2008, p. 63-106. [5] Adrian and Shain (2009), Brunnermeier (2009) Greenlaw et al. (2008) and Taylor (2008) presents a thorough dissection of this controversial concept and offer a solid and useful alternative perspective which harmonizes the antagonistic positions.