Economic theory and current global financial crisis

Jenica Popescu and Dorina Poanta ()
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Jenica Popescu: University of Craiova

Finante - provocarile viitorului (Finance - Challenges of the Future), 2010, vol. 1, issue 11, 122-127

Abstract: Economic systems as inherently unstable like financial markets and we should not seek to achieve perfect stability. A strategy may have more support would involve allow-ing, and sometimes encouraging, a larger short-term cycles, using drop smaller, more fre-quent work to rid the system of excesses. In this way, it can be avoided crises forced the kind where we are now. To achieve this policy it would require recognition of the impor-tance of the volume of excessive credit growth and excessive decline in the volume of credit, and a review of our attitudes related to central bank policy and economic cycles. Normally we should not consider any economic contractions as failures of government policies, but to see them as a normal part of development of a healthy economy. We should strive to achieve some of this improved stability by encouraging greater self-discipline of the financial market participants. It would be useful in a clear message ex-plaining under-basis limitations on certain macroeconomic variables and the value of oth-ers; significance of monitoring credit creation should be increased.

Keywords: financial crisis; debt; tax supervision (search for similar items in EconPapers)
JEL-codes: E58 G01 H20 (search for similar items in EconPapers)
Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:aio:fpvfcf:v:1:y:2010:i:11:p:122-127

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