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Causes of the Crunch

Geoff Riley

8th October 2008

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What links the following?

China The liquidity bubble Search for yield Sub-prime lending Leverage Originate and distribute Alan Greenspan The Democrats The Republicans Regulators Credit rating agencies Financial Services Authority Greedy bankers Consumers/housebuyers Margaret Thatcher Moral hazard Gordon Brown Mark-to-market accounting Basel 2 Estate agents

According to Sean Farrell and Sean O’Grady from the Independent, they have all contributed in one way or another to the credit crunch. Here is the link to what is an excellent background article for students.

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Geoff Riley

Geoff Riley FRSA has been teaching Economics for nearly forty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD and Revision conferences in the UK and overseas.