Political conflict among the big powers about controlling on the natural resources regeons these big powers which direct the countries economies according to their interests.

Tom Weisskopf

(1) The economic crisis began in U.S. housing market, quickly spread to U.S. financial sector, then overtook the whole U.S. economy – and became a global financial crisis. (2) The U.S. housing crisis was set off by spread of sub-prime mortgages – loans made to homebuyers who simply did not have the means to meet their payment obligations. The ratio of subprimes to all mortgages rose from an historical level of less than 8% to about 20% in 2004-06. (3) Why would any financial institution lend to such borrowers? a) Economic actors became increasingly confident that economic good times would last forever, and that serious recessions were a thing of the past (that’s what many economists were saying!); b) There was a huge world-wide build-up of pools of savings – e.g. from booming emerging market economies – in search of new and more profitable investment outlets; c) Financial institutions developed lots of new financial instruments they thought would protect them against risky ventures – often by passing risk onto other investors; d) Governments adopted increasingly laissez-faire policies toward business in general and financial institutions in particular, weakening regulatory policies set up in 1930s (to deal with the Great Depression) and allowing new financial instruments to operate without regulation. (4) As a result: a) mortgage brokers were encouraged to lend to borrowers with no serious questions asked about their ability to pay b) initial lenders would quickly sell the mortgage contracts to financial institutions, escaping any exposure to risk of default; c) financial institutions would in turn "securitize" the acquired mortgage contracts; d) credit-rating agencies, afraid of losing business by refusing to go along with the whole scam, would accord undeservedly high credit ratings (indicating low-risk). (5) This left many high-risk investments – "toxic assets" – in the hands of major financial institutions who had bought the complex securities in a profit-raising strategy that included a very high level of financial leverage (ratio of investments to liquid assets). (6) This whole mortgage & finance structure – in effect a global Ponzi scheme – was bound to come to a crashing end, as it did in 2008 with onset of the current crisis.

Dear Dariusz

There are several reasons for the present, past and futures economic and financial crisis. According to me:

# corruptions in every sector

# Climate change ( natural disaster)

# Laziness (especially in middle East and Muslim countries).

# bureaucratic problems

# political instability

# less production due to unsustainable practices etc etc.

Thank you

Most important source of economic crises are unequal distribution of resource, unequal use of resources and high demand of scare resources rather than highly important things

Manipulated exchange Necessity, beyond own priorities, capabilities and Versatilities, streaming into an environment that allows it.

Hello Dariusz Prokopowicz

In my opinion:

#Reducing the sources of fossil fuels and underground resources # Lack of fertile soils

#Disregarding handicrafts in each region #Reliance on other countries

#Lack of natural resources for energy production (wind energy, water, sun, underground)

Bad politics and mistaken policies.

https://www.researchgate.net/project/Geonomics-in-1-Lesson

The quantity of economic rent is decisive; it impedes growth, drives liquidity into asset hoarding and kills productivity. A new economic cycle starts with investment opportunities, which reinforce productive growth of the human economy; next innovations are eco, bio and health tech as future engine of growth. The study of interest rates is essential, in this respect, as already JvNeumann expressed in some formulae on economic and game behavior.

I will go for lack of institutional reform and legislation. Although, there are extensive financial derivatives to cover the risk but there is not as such development in legislation. Fiscal and Monetary policies can invade the economic and financial crisis. However, it's witnessed in the past that geopolitics and conflict of interest lead towards catastrophic disaster.

Dear Mr Prokopowicz,

in my opinion there's a wide variety of intertwined, complex causes of current gigantic problems. Listing by their importance, these are: 1) complete misdirection and utter insanity of global central banks monetary policy since at least 2008, whereas structural problems of the past crises have not been addressed in their entirety. 2) Instead, by digital printing trillions of dollars major dislocations in capital allocation occured, coupled with moral misbehavior and elites' greed and hazardous, bubbles-inducing activities like incessant buybacks; leveraged mergers and buyouts; collecting still larger portion of wealth in the hands of still less 'experts in doing God's work' (Blakfein, Goldman Sachs); 3) next and dependent on the previous issues is imposing negative yields on the whole nations, which is obvious financial oppression, by the way forcing people into speculative ponzi stock markets and risky derivatives, ETFs and so on. 4) These structural defects are coupled with yet one more fundamental cause namely exponential debt explosion causing in turn critical fragility of entire economic systems. These issues pave the way or even exacerbate panoply of various infringements, like overgrown shadow banking system, speculative bubbles in properties, notorious risk mispricing. As a final effect we are witnessing still larger crises (2000-2008-2019..?), until a complete reset occurs in an unpredictable disroderly manner, possibly including global conflicts. Modelling these dependencies is an extremely challenging task and I am sure there's a plenty of work to do with quantitative approach to critical instability of current financial systems.

Excuse my lengthy essay.

Greetings, B.

Dear Professional

In my opinion, Ineffective Corporate Governance practices, outdated legislations,unethical practices adopted by corporate houses to mint money in the short run at the cost of long run etc. may result in economic crisis,sooner or later.

Regards

Dear all

My thinking is that,most economic crises are cause by greed (herd like behaviour of economic agents-following the wind instead of analysing the situation-financial crises of 2008),and most are political (bad economic policies)

Après les réponses lues, nous pouvons citer les principales causes comme suit :

1-La Répartition inégale des ressources, l'absence de dosage dans l’utilisation des ressources et l’excès de demande en ressources rares

2-La cupidité des agents économiques mus par l’appât du gain et l’égoïsme des êtres humains

3-La mauvaise gouvernance des unités de production des biens et services.

Personnellement, j’ai tout résumé en un seul terme depuis 2002-2003 dans mon article "Vérité des faits et crise de la science économique : thèse de l’énergoïsme (ou Contribution à l’explication de la crise de la Science économique et de ses lois : L’économie politique orthodoxe reflète–t–elle la vérité des faits et ses lois sont-elles celles de l’énergie ou celles de l’égoïsme? "

Article publié par la revue TAWASSOL, université Badji Mokhtar d’ANNABA N°10, mars 2003 –pp 20-71 –Publié également dans la revue européenne du droit social de Targoviste (Roumanie), Volume16, fascicule2, 2008, pages 23-76 : http://www.revueeuropeenne-du-droitsocial.ro/reviste/nr3.html

Grosso modo, il y est dit qu’aucun de nous n’est un ange, même si, par moments, l'individu peut paraître à la fois « mi-ange, mi-diable » et cela rejaillit tout naturellement sur ses idées et ses théories.

Dans ce tournis des métamorphoses, il semble tout de même qu’un principe demeure éternel : c'est l’égoïsme de cet être éphémère qu’est l’homme….L’homme fait tout pour satisfaire ses désirs et ses besoins, en un mot pour s'épanouir au sein de sa société en qualité de citoyen. Comme le précisent beaucoup d’auteurs à tendance marxisante, pour être citoyen à part entière aujourd’hui, il faut (hélas) de plus en plus de moyens. Mais, la collectivité, jusqu’à présent, a pour habitude de fournir avec les moyens un « modèle ». Il lui arrive même de suggérer un modèle de vie sans en donner les moyens, ou encore de subordonner les moyens au modèle. C’est cette difficulté qu’il faut dépasser. [Fournier et Coll., 1979]

Et ces mêmes auteurs estiment qu’aucune avancée ne sera possible sans « réduction de la durée du travail » permettant de mieux utiliser les ressources humaines. Il ne s’agit évidemment pas de réduire la capacité des hommes à demeurer des citoyens en leur diminuant leurs revenus. Par contre, il faut faire en sorte de sauvegarder les deux aspects de la question : la réduction du temps d’effort (travail) et le maintien du gain obtenu (salaire) sinon l’opération envisagée perdrait toute sa signification de réforme sociale fondamentale. Pour cela, et ce n’est pas seulement de la morale, chacun des citoyens est interpellé, sa contribution demandée et sa modération exigée….

Finalement, et nous répétons ce qui est écrit dans notre propre thèse de doctorat d’Etat (2002) et dont nous réclamons la paternité, l’ensemble de l’activité économique semble, selon notre humble recherche, régi par quatre grandes lois :

01-la loi du moindre effort qui pousse les agents économiques vers la diminution des "coûts" : il s’agit là de réduire au maximum les contraintes et les exigences de tout processus de production, de fabrication ou de réalisation ;

02-la loi d’optimisation de l’effort qui aboutit au maximum de plaisir avec le minimum de peine, c’est-à-dire obtenir un maximum d’utilité pour un minimum de dés- utilité : il s’agit ici de faire les meilleurs « choix » possibles ;

03-la loi d’intellectualisation de l’effort qui vise l’augmentation de la "productivité" du travail : cela signifie que l’unité de temps de travail doit rapporter beaucoup plus que par le passé ;

04-et, enfin, la loi de non équivalence de l’effort qui permet de réaliser la "plus–value" : cette loi s’exprime par l’échange non équivalent qui permet de concrétiser des profits…

Ces quatre lois constitueraient évidemment un tout théorique que nous avons décidé personnellement d'appeler la Théorie de l’«ENERGOISME». Dans ce terme, il y en a deux, "énergie" et "égoïsme", qui sont imbriqués l'un dans l'autre. Il ne s’agit pas simplement d’un jeu de mots ; nous ne serions d'ailleurs pas les seuls à tenter d’en forger de nouveaux puisque par ailleurs, « de nos jours, dit-on, on entend parler de "ecomoney" chez les monétaristes, "écolonomie" chez les écologistes, "égonomie" chez les markétaires (gens du marketing) (…)». [Boukhaoua, 1996]

Energoïsme et Anti-énergoïsme

Évidemment, cette "théorie" est loin d’être le reflet des fonctionnements réels de la société pour la simple raison que ses lois sont souvent dénaturées, dans le cadre de la relation dualiste de toute activité économique, par l’homme lui-même (décisions humaines : passions, désirs, haines) ou par la nature (inondations, séismes, cataclysmes, cyclones).

Ainsi, nous avons écrit ceci :

01-La loi du moindre effort mène plutôt vers la paresse, le vol, le "non –amour" du travail. Il n'y a pas pire qu'un peuple de "fainéants et de voleurs". Nos concitoyens sont passés maîtres dans l'art de s'absenter à leur travail, d'y arriver en retard ou de ne pas le faire selon les normes. La décennie 80 en fut le meilleur exemple ;

02-La loi d’optimisation, quant à elle, mène vers le gaspillage, la destruction, vers l’épuisement des réserves naturelles. Avec le désir de faire la transition à l'économie de marché, nos concitoyens se sont mis aujourd'hui à tout « calculer ». Quant aux dirigeants du pays, cet esprit les pousse à optimaliser l'exploitation de nos gisements d'hydrocarbures à outrance. Le sud algérien est de plus en plus livré aux compagnies étrangères et aux multinationales au cours de la décennie 90 ;

03-La loi d’intellectualisation mène, paradoxalement, vers la négation de la condition humaine. À vouloir équiper toutes les branches et tous les secteurs du pays, les concepteurs de la politique économique algérienne, les "industrialistes" et les "scientistes", enfermés dans leurs tours d'ivoire (conseillers des ministères et de la présidence), ont fini par faire épanouir surtout l'exclusion et le chômage ;

04-La loi de non équivalence mène, enfin, vers le pillage et l’exploitation, sources des conflits, et vers le non amour de l’autre. L'absence de démocratie, le pouvoir de monopole et la fuite devant la responsabilité depuis la décennie 70 ont mené à la corruption et à la situation de conflit, qui s'est étalée jusqu'à ce troisième millénaire.

Faudra-t-il, un jour, sacrifier "l’économique" pour sauver l’économie ?

En fin de compte, il semble que le problème réel de l’humanité est de faire du mimétisme socio-économique et, de cette façon, à chaque période de notre histoire, nous avons eu droit à la prédominance d’une théorie économique du développement et à des représentants ou leaders, généralement de l’Occident bien évidemment (Ricardo, Hirshman, Nurske, Rostow, Lewis, Keynes, etc.). Aucun d’eux n’aura donc réussi à sauver le monde et surtout le Tiers-monde de la misère et de la pauvreté d’une partie de leurs populations et surtout à sauver l’université de la crise des théories pompeusement exposées et remerciées par des prix divers (comme le Nobel).

Mais, pourquoi donc? Tout simplement, parce que l’on a oublié l’homme, ce roseau pensant. Au lieu de viser le développement durable (ou soutenable ou soutenu, etc.), pourquoi ne pas chercher à mettre en place un processus de développement raisonnable? Ayons les pieds sur terre et maîtrisons nos instincts délurés. Le bonheur c’est de savoir apprécier ce que l’on a d’abord sous les yeux. Des communautés perdues dans le monde (exemple du Bhoutan) ont des populations heureuses sans disposer de complexes nucléaires et sans avoir cherché à atteindre la lune (sauvons d’abord la terre).

En toute modestie, ai-je dit, je vous recommande la lecture de mes ouvrages publiés dans le monde, tels que: le B.E.C ou « le bréviaire économique du chercheur et de l’étudiant » en 2003 (Direction des Publications de l’Université – Annaba – mai 2003 – En français; 687 pages) ; «Mondialisation et développement, Mondes d’hier et mondes de demain» par Albagli Claude et Boumendjel Saïd (sous la direction) : Collection MES, Harmattan, 2008 (cet ouvrage n’a pas paru ; en 2011, « Le développement économique et Ricardo / Le modèle ricardien du développement et de la répartition à l’épreuve du cas algérien» – Editions universitaires européennes (19.12.2011) ; ISBN-13: 978-3-8417-8030-0 ; ISBN-10: 384178030X ; EAN: 9783841780300 ; « Le nouveau bréviaire du chercheur économiste » – Editions Al-Djazair, Alger – mai 2015 ; « Mondialisation et dynamique des capitalismes » – Editions Edilivre, Paris–2016 – ISBN : 978-2-334-06552-8 ; « Economistes contemporains et de renom » – Editions Houma, Alger –2016. ISBN : 9931-03-122-2 ; et, enfin, en 2018 : « Développement raisonnable » – Editions Edilivre, Paris–2018.

Ancien professeur des universités à la retraite

M. BOUMENDJEL Saïd d’Annaba (Algérie)

dear Mr Dariusz

i think the speculation and monetary and fiscal policy that favors the capitalist system.

Their are two most important factors in financial crisis: 1) Uncoordinated regulations and supervision by the regulatory authorities. 2) Unethical practices by the operators

Financial reasons in the day s world

Financial crisis will precipitate economic crisis. Financial institutions will be unable to finance deficit units. General consumption of goods and services will decline. Default rate on payment obligations will increase. Corporate profit will decline.

This is a question that cannot easily be answered in a few sentences. Many factors have already been identified by sholars above, so if I were to say what I think as a major factor leading to economic crises I would rather vote for excessive political intervention in the economy. An example is the US government policy to make housing affordable for all americans. This policy led to artificially low levels (i.e.: below the level defined by the economic law of supply and demand for money in the free market) of interests by the FED. The result was an artificialy high demand for loans and housing which led to the house market bubble that eventually collapsed triggering the crisis of 2008.

Dear Prof. Prokopowicz,

You can say that largely due to the influence of scientists like Sen, Rawls, Atkinson and Stiglitz and Benhabib and Geanokoplos and Polemarchakis, that I have in my research discovered the results that given human nature as is captured by the calibration of assumptions in the Arrow-Debreu model with DGE (Mallick (1993,...) ) that the root cause of market failure and therefore crises of laissez-faire capitalism is inequality. The very inequality which makes the market system work in the first place. Hence, one is tempted to say that the Fundamental Calculus of Markets as both Marx and Keynes hinted, is the cause of crises. I don"t know whether the conservatives will like this piece of evidence but, if, as we are doing in R&D we are trying to bring inaccebility to infrastructure down by trying to invent cheaper Econophysical machines and systems which can be used to build cheaper and cheaper roads from example, market participation and effective demand by the Keynesian route can be increased and crises averted dynamically to grater measures.

Soumitra K. Mallick,

For Soumitra K. Mallick, Somak Raychaudhury, Sandipan Mallick and others,

RHMHM School,

USA, Japan, India

I thank financial and monetary reasons

Many reasons @Dariusz

Interest rates

Institutions stability

Financial institutions development

Human behaviour

Credit cycles

There is only one reason for a National economic crises: the export of capital in all forms such as sovereign debt, stocks, private wealth and even real estate.

Then the creditors attend payback and put pressure on the country such as on Venezuela currently.

Don't export your capital - no crisis will happen.

I am standing in the shadow of Stephen Ternyik

I would argue that politically facilitated pursuit of economic rent is the burden shifts economies toward recessionary cycles. It creates misinformation. Nevertheless, the cognitive biases that are behind these dynamics appear to be deeply entrenched. The self-delusion behind extracting rents and power relations necessary to maintain seems to be a fundamental struggle in the human condition.

Take for example QE which made low-cost (cheap) and accessible, the financing which is prolonging the lives of zombie companies that would otherwise have met their maker in a bankrupts court. When these Darwinian moments cannot take place, capital and risk cannot be assessed efficiently. When market volatility is on the rise, it means that people are comprehending the danger of loss and possibility of gain. Normal is where active investment strategies matter because people can make effective decisions. Higher interest rates are the second step. The last year nine has tied-for-second-longest American business expansion, 20% of the Russell index companies fail to cover interest expense out of earnings before interest and taxes. Sixteen per- cent fell short in 2007, 18% in 2012. For a blue-chip point of comparison, 8.3% of the S&P 500’s constituents show such a deficiency now, compared with 4% in 2012 and 3% in 2007. We need to brace ourselves for a rollicking recession.

This question is not a matter of how do we avoid business cycles, instead of how do we manage the crooked timber of humanity to prevent it from creating abnormally destructive cycles.

Scott

Do not forget political corruption: selling crucial political decisions with economic impact to the highest bidder.

You're right Cristina, but normally these are not single persons but groups, quite often big groups such as e.g. in Germany self-employed people and State employees (together around 7 million people with a high income) do not contribute to the National pension system which therefore has a deficit of € 65bn per year.

Greed of people.

When banks over-leverage. We are there again, we appear to not have learned.

Depending only in one sector and ignore other sectors

Populism does not help the economy. Look at the UK. And the Brexit is still ahead.

Follow

non-regulation and inequality

Consumer confidence, unemployment rate and High-interest rates.

The adventurism of the Financial Sector.

Poor policy and plan

Too much banking debts and bad internal and external policy.

Dear Friends and Colleagues of RG

Is it possible to diagnose specific symptoms of another financial and / or economic crisis that may arise in a few years?

Best wishes

The most important sources of economic crises in Iraq are the decline in oil prices globally، terrorist wars as well as financial and administrative corruption

Economic crises at the global level tend to arise through loss of confidence in governments to manage their economies.

The GFC and current imbroglio between the USA and China, and others, stem from government mismanagement. and incompetence.

The big problem with corruption in determination of economic management is our inability to assign any value to it. It is subsumed in bad politics and policies. They surface in lack of essential infrastructural needs of the economy.

Global monetary tightening, increased oil prices, and reduced investor confidence have negatively impacted the world currently precarious economic situation.

Financial crises lead to economic crises, and vice-versa.

Financial crises are less predictable than are economic crises.

Un experienced Politian with bad planning and strategies

Financial crises ;

Вad planning .

Inflation resulting from the capitalist system

- Mortgage fraud

- Lack of effective control by the JSC

In my country, there is no control on an administrations of government because militias, it means there is no loyalty.

La cause est en nous mêmes et la solution aux crises l'est également.

Je vous recommande la lecture de l'article paru dans la Revue Tawassol, université Badji Mokhtar d’Annaba – N° 10 de mars 2003 – PP 20-71 : .

sous le titre de: contribution a l’explication de la crise de la science économique et de ses lois: l'Economie politique orthodoxe reflète-t-elle la vérité des faits et ses lois sont-elles celles de l'Energie ou celles de l'égoïsme ?

Political conflect has a significant affect.

political crisis

Lack of political and corruption in government.

Dear Colleagues and Friends from RG,

Based on the above considerations and conclusions from the discussion on interesting issues discussed, I formulated the following thesis that by examining the process of development of economic processes and the development of economic, financial, debt and other crises, many sources of these crises were diagnosed. It is particularly important to analyze the source factors that determined the development of the global financial crisis of 2008. One of the important determinants of the emergence of the global financial crisis of 2008 is the efficiency, quality, reliability etc. of credit risk management processes carried out in investment banks and in institutions supervising the financial system. I am researching these issues and the conclusions of my research are contained in published articles. I would like to consult with you the importance of improving credit risk management processes in the context of the genesis of financial crises.

I would like to add a few words to the above discussion on the development of interesting issues of economic, financial and other crises. In the context of the above discussion, I am asking you:

- What kind of source factors do you consider to be crucial in the creation of the global financial crisis of 2008?

- In your opinion, is the quality and effectiveness of the process of improving credit risk management in financial institutions an important determinant of the origin of financial crises?

- Were credit risk management processes carried out after 2008 in investment banks and financial supervision institutions significantly improved and the risk of another financial crisis arising is low or still high?

What is your opinion on this topic?

Please reply

In one word: Greed!

Dear Dr. Dariusz Prokopowicz ,

I think the two most important drivers for economic crises are the turbulence in political situations and the tensions in that particular region of the world. These issues can provide excuses for corruption and lead to crisis.

Usually, in areas of political conflict there are economic problems. And also to achieve political goals.

Usually, in areas of political conflict there are economic problems. And also to achieve political goals.

Corruption and economic mismanagement.

Corruption and lack of experiance.

Dear Colleagues and Friends from RG,

In the context of the above discussion, I ask the following questions about trying to diagnose potential sources for future, subsequent national or global financial and economic crises:

- Can the source of another global economic crisis be a synergistic, simultaneous increase in public finance indebtedness in many developed and developing countries at the same time, i.e. an increase in public debt and the deficit in central budgets of most countries? The problem with controlling this type of crisis would be related to the issue of simultaneous increase in the public finance system debt in most countries of the world.

- Can the source of another global financial crisis be the rapid decline in the significance of classic international currencies in the situation of crowding out these currencies in online international settlements by cryptocurrencies? The importance of critics in online transactions is growing rapidly. Some Internet technology companies, including those managing social media portals and investment banks, are already creating their own critics. Some mutual funds have been investing in Bitcoin and some other cryptocurrencies for several years.

- Can the source of the next global financial crisis be the decline in the importance of the currently most important international currencies, representing the largest developed economies of the world, in a panic situation, a sudden sale by Treasury bond creditors of these countries (e.g. if banks in China would start selling open at one time) market Treasury bonds issued by the Treasury in the USA)? This type of crisis could occur in a situation of deepening trade wars between the world's largest economies. Then some international currencies could quickly depreciate. The turmoil in the currency markets would trigger a crash on the stock exchanges of other financial markets.

- Can another revaluation of securities valuations on stock exchanges be the source of another global financial crisis? The revaluation could be caused by too much cheap money supplied to the financial system by central banking. In addition, the increase in the use of automated transaction systems, which can lead to a significant increase in the share of transactions concluded by automated transaction systems in which orders are carried out by computers, orders for the purchase and / or sale of securities, currencies, raw materials, derivatives, indices, etc., orders of high cash value supported by automated, computerized transaction systems operating under the control of large funds and investment banks.

- Can the source of another global financial crisis be the raw material crisis in the scope of supplying key strategic raw materials to the market, such as oil? The reason may be a failure of one of the largest oil refineries. An example is the recent drone attack on oil refinery installations in Saudi Arabia that happened in mid-September 2019. One drone launched from another country caused a fire and damaged a large oil refinery in Saudi Arabia and a sharp rise in oil prices on commodity exchanges.

Please reply

I invite you to discussion

Thank you very much

Best wishes

Dariusz Prokopowicz

Corruption of administration.

in addition my previous an answer the thief is in the government.

Corruption and financial mismanagement

To my understanding, economic crisis depends upon two prime things: Resource scarcity in a particular country and optimal utilization of the scarce resource. For a given country first one is given. Only for the second one comes strategy, planning, governance, political wisdom and host of other things. You may say corruption, mismanagement,over utilization etc are responsible for economic crisis...but essentially it mean not using scarce resource optimally.

Hi,

Improper management, lack of planning, unresponsive government (not proactive) are the major reasons for economic crisis, in my perspective.

Politicians and economic (mis)advisers.

Their sources are the imbalance between offer and demand

Differences between rich and poor

The inability of poor countries to catch up with developed countries

An emergency disaster

The economy in general is still out of balance. (John Maynard Keynes)

From my point of view, the most crucial cause of an economic crisis is the lost of confidence of the people on the economy. When this happens, people stop doing logical things they usually do. In facing the uncertainty of the economy, people reduce demand drastically. Oversupply would follow immediately. Untreated, unemployment would certainly rise. Demand would fall further, dragging the economy into a downward viral.

De acuerdo, pero por qué la gente pierde la confianza en la economía? Existen agentes que promueven,en su propio beneficio, esta circunstancia?

Dear Colleagues and Friends from RG, The economic situation in the economies of many highly developed and developing countries has been deteriorating for several quarters. In many countries, consumption, production, investment, employment and economic growth have fallen for at least several months. On the other hand, the levels of valuation of securities on stock exchanges still remain around the record maximum levels. Does this mean that the level of investment and credit risk on financial markets is increased? If so, in the following months it is possible to change the long-term, long-term upward trend to a downward trend known as the stock market slump. If so, the continuation of negative trends in the real economy may lead to a significant drop in profitability also in financial sector entities, including commercial and investment banks. If entities of the financial sector granted loans with a high level of credit risk, the continuation of the economic downturn in the enterprise sector will mean a decrease in the timely repayment of loans. The result will be a decrease in the quality of the loan portfolio. In a situation of a significant increase in the risk of liquidity, profitability, debt, etc., this may lead to a permanent loss of liquidity in some financial institutions. help from the central bank in the form of low-interest loans and the purchase of junk securities and outstanding loans can be a rescue. However, if loans were granted similarly to 2008 in some commercial and investment banks with too high a level of credit risk, non-compliance with financial security procedures, violating the principles of business ethics and corporate social responsibility, this may lead to bankruptcy by a specific financial institution. If this financial institution, which would declare a permanent loss of liquidity and financial bankruptcy, turned out to be a large bank, then investors operating on financial markets could interpret this event as the beginning of the next financial crisis. But this is not the only possible scenario of a possible future change in the long-term upward trend to a downward valuation of listed assets and the beginning of the next financial crisis. other scenarios are also possible, other factors that could be interpreted by financial market participants as a diametrical change in tendencies in business cycles drawn in the framework of technical analysis graphically illustrating the situation on financial markets.

For many years there was a strong correlation between the state of the economic situation in the domestic and global economy, between the shaping of business cycles, the development of key economic growth factors and the national socio-economic and monetary policy pursued by the state, and the situation on the financial markets, the situation and the cyclicality of stock market trends securities. However, since the end of the 20th century, there have been more and more examples of the lack of a full correlation between the shaping of business cycles, the development of key economic growth factors and the state's socio-economic and monetary policy pursued by the state, and the situation on financial markets, the situation and cyclicality of stock market trends on stock markets . In addition, as the scope of this correlation diminishes, the risk of unpredictability of the situation on financial markets increases.

In recent years, there have also been more than before national and supra-national currency, financial and economic crises. To the analysis of the issue of the above-mentioned correlation, determinants of economic development should be added, which earlier until the 1970s did not develop much or did not occur at all, such as the development of ICT information technologies, Internet and advanced data processing Industry 4.0, high deregulation range financial markets, the increase in the importance of central banking in the financial systems of individual countries, the development of the international market currency system based on the model of floating exchange rates without parity of a fixed economic factor, e.g. resignation from gold and parity of one international currency, development of investment banking based on investment in securities valuable technology companies with high credit risk, development of derivatives and their use in hedging transactions concluded on other financial markets, investment product markets in the real economy and markets of the construction sector. Therefore, since the end of the 1990s, some financial markets have been very susceptible to various economic and financial factors, which in a short time can be interpreted by financial market participants as a possible beginning of the financial crisis. A significant part of financial markets, including currency markets, energy commodity markets, securities, derivatives, etc. acquire the features of speculative markets, increasingly vulnerable and sensitive to various, unpredictable events occurring both in these markets and in the real economy.

In the context of the above problems of analyzing the correlation of the situation on capital markets with respect to the economic situation and key determinants of economic development, it is important to answer the following questions:

- Can moral hazard and unreliable compliance with risk management policies and procedures significantly increase credit risk in commercial banks and become a key factor leading to another financial crisis?

- Can the factors leading to the next financial crisis include the dynamic development of ICT and Industry 4.0 information technologies implemented to support stock market transactions and the process of automating credit risk management?

- If Brexit had happened, if Brexit had become a fact, how could strong short-term and long-term concessions appear on international financial markets?

- Can Brexit or other factors, such as deepening currency wars between the world's largest economies, be a key factor in generating another financial crisis?

- Perhaps, once again, too much overvalued market valuations of securities on stock exchanges and other assets on other financial markets, on the currency and commodity markets may be an important factor of increased systemic credit risk?

- Can the source of a serious next stock market crash on the stock markets and another global financial crisis be the speculative rise in property prices in major economies and / or moral hazard and exceeding safe credit risk levels in investments in corporations developing new technologies in the field of ICT, internet information technologies and advanced data processing Industry 4.0?

- Can the development of cryptocurrencies prove to be a significant competition for bank settlements using traditional currencies? If cryptocurrencies will be developed by technology corporations, international industrial and financial corporations, by fintechs, can it cause a significant decrease in the profitability of commercial banks in the next few years?

- Can the development of the applications of Financial Industry 4.0, Business Intelligence, Data Science, Data Analytics, Big Data in the field of fundamental and technical analyzes carried out to examine future trends in the capital markets, including securities markets, can lead to an increase in the self-activation of transactions concluded in the markets financial and how can this affect the systemic investment and credit risk in the financial system?

- Which of the following factors do you consider to be the main potential source of the next financial crisis? What other factors could trigger a future global financial crisis?

Please reply

I invite you to discussion

Thank you very much

Best wishes

Dariusz Prokopowicz

Poor strategies and plan

The greedy nature of financial managers and political corruption

I agree with @Chuck A Arize and the other colleagues, greed and corruption are at the heart of crisis, but this doesn't concern only the wolfs of the market or the politicians, some professor and scientists are implicated to.

Greed, corruption and incompetence.

The most important sources of economic crises are the infinite growth bubble (given finite resources), the income bubble (hunger, poverty, inequality), and the financial bubble (international flows of capital do not serve the commons).

High unemployment levels can result from an economic crisis in action or can be one of the causes of it. An economic crisis can occur when high interest rates, tight lending and a decrease in consumer spending results in companies letting go of employees to survive the economic downturn.

The lack of trust of stakeholders and the spread of fear and insecurity.

Greed and stupidity.

Think of the leader of the world's most powerful country.

Economic development faced several economic crises, which were old stems from conditions Outside human will such as drought and drought, wars ......, but in the modern era has become more

Complexity has become the result of the economic and social behavior of individuals and organizations, such as the imbalance in

Marx's production patterns, and the great controversy over state intervention caused crises from

The countries of the globe were divided into two groups, a socialist group and a capitalist group

Even within the group of capitalism, there was debate about state intervention in the economy, and capitalism began

Its economic history with crises since the beginning of the 19th century, but it was local and regional

At its maximum spread

Reckless Government spending.

Instability in international financial markets, which no one understands fully.

There are no accurate models of economic or financial crises, which are typically regarded as aberrant events, or outliers that come from a different universe.

Good projects should be supported in order to help the economy.

subprime mortgages!

Encourage investments in the economy to develop agricuture sector.

Volatility, volatility and volatility.

Bank interest rates

الفساد و الجشع

Financial, administrative and moral corruption

Poor financial management might be considered as un important factor.

Dear Colleagues and Friends from RG, In connection with the development of economic globalization in international financial systems, the increase in the scale of mergers and acquisitions in the field of capital transactions in the financial sector, which leads to the emergence of larger and larger banks operating globally, in addition to deregulation in financial markets, the growing importance of monetary policy in the context of interventionist economic policy, the development of international liquid exchange rate systems on currency markets, the development of derivatives used not only to hedge other financial transactions but also to speculative activities on capital markets, etc. since the 1970s, systemic credit risk has been increasing and the frequency and scale of domestic and supranational occurrences financial and economic crises. In connection with the increase in systemic credit risk, the importance of effective operation of financial supervision institutions and improvement of the credit risk management process is increasing. In the 1990s, serious mistakes were made in enabling the combination of investment banking with the classic deposit and loan system in the Anglo-Saxon financial system, thus lifting restrictions and instruments ensuring a high level of system security in commercially operating financial systems. These types of erroneous changes in prudential regulations that reduce the scope of effective operation of financial supervision institutions and credit risk management systems increase the likelihood and scale of negative effects of subsequent financial and economic crises. To this should be added the serious mistakes that were made in shaping monetary policy and allowing for a rapid increase in public debt in public finances even before the global financial crisis emerged in autumn 2008. In the context of these facts and the increase in systemic credit risk, there are considerations whose main purpose is to verify the research thesis on the question of the possible, excessive growth of the commercially operating financial system in modern economies and on an international scale, far above the needs and macroeconomic conditions of currently functioning national economies.

Therefore, in order to verify this type of theses, one should consider the answer to the following question:

Is the over-expanded commercially operating financial system operating more and more speculative on financial markets, including not only credit but also securities, derivatives and currency markets, speculative investments in raw materials, etc. in modern national economies and on a global scale may displace classically implemented investments involving the implementation of investment projects leading to the creation of real, direct, sustainable, investment financial economic goods by enterprises (financed from non-bank financial sources) and by the state (investments financed from public funds, with particular emphasis on national economies with their own national currency)?

What do you think about it?

Please, comment on the thesis above and answer the above question?

What is your opinion on this topic?

Do you agree with me on the above matter?

Are there any publications describing this issue or research conducted in this topic?

Please reply

I invite you to discussion

Thank you very much

Best wishes

Dariusz Prokopowicz

The most powerful banks and insurance companies at the world, respectively greed of theirs top mangers and leaders. All former world crisis are induced with purposely. In other words, the most important source of crisis is a man.

Inequality

Greed & lack of Political Will.

Investment in research and development is necessary.

Professor Noori Abdul-nabi Nasir mentioned earlier about consumer's confidence. I believe this factor is quite crucial as it often magnifies the impact of the crises caused by all other sources. The economy may survives every disruption as long as the people still have confidence that everything will return to normal. Once they lost their confidence, people will act irrationally. They distrust the common economic norms and rely on their instinc to survive. When this happens the disruption becomes a crisis and eventually the economy falls into a downward spiral.