What was the cause of the US economic crisis in 1929? I read some information for a variety of reasons, Some say the "credit crunch", （Mr. Bernanke said it was because of the credit crunch. Do you agree with him?）some say overproduction, others say the gap between rich and poor, and others say that the stock market is too hot. So what do you think caused the Great Depression of 1929? What about the subprime mortgage crisis in 2008? What is the reason?
By the way, why does the speed of money flow to calculate only the Fisher equation?MV=PT This speed is macro-general, so why is there no micro or local formula, such as the formula of money circulation speed between banks and borrowers? We can find that different parts of the same economy obviously have different currency circulation rates. Why not such a formula?
Preprint Analysis of Financial Crisis Causes and Complex Systems Scie...
1). Overproduction, executive inaction, ill-timed tariffs and an inexperienced Federal Reserve were causes of the 1929 Great Depression.
2). Deregulation in the financial industry, offering cheap subprime credit, relaxing lending standards and falling house prices were causes of the 2008 financial crisis. When house prices began to fall and banks were reporting massive losses, lenders refused to lend any money to the banks that held large amounts of mortgage-backed securities. This led to the credit crunch (or a freeze in lending). Yes, Bernanke is right.
Peterson K. Ozili
Your answer is so good, I think it is accurate. Thank you very much
The rapid decline of housing prices in the US following a prolonged boom was the main reason for the subprime mortgage crisis in 2008.
I mean the cause of the subprime mortgage crisis in the 2007 and 2008 in the US.
Asrat Araya
But didn't the 2008 economic crisis be the cause of credit expansion? The banks have borrowed too much
The same cause, who are the private bankers based in London and Germany. You may want to read the Hazar Circular as the foundation and the work by Professors Richard Werner, Steve Keen, and Michael Hudson for the empirical analysis.
Bankers, who worked behind the scene wanted it to happen to send a message to certain people. The US managed to avert the crisis in 2008 because they adopted the real quantitative easing (QA) as recommended by Prof Richard Werner. The ongoing QA is a fake or distorted one.
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