复旦大学：《宏观经济学 Macroeconomics》课程教学资源（A）Student Projects_The role of fiscal policy in the Financial Crisis_Theory, Case and Evaluation

Monetary and Fiscal policy during C 11s1s ei Qiongwen 07300550037 Kang Mingu 06307036034 Xu Meng07300260057 Piao Youran 07300260059

Monetary and Fiscal Policy Monetary and Fiscal Policy during Crisis L i Qi 07300550037 L ei Qiongwen 07300550037 Kang Mingu 06307036034 X M 07300260057 X u Meng 07300260057 Piao Youran 07300260059

Outline a Causes of financial crisis a Effects of Financial crisis a Monetary policy during crisis a Fiscal policy during crisis

O tli u ne  Causes of Financial Crisis  Effects of Financial Crisis  Monetary Policy during Crisis  Fiscal Policy during Crisis

Types of Finacial Crisis 口 Banking crisis a Speculative bubbles and crashes o International financial crises u Wider economic crises

T f lC ypes o f Finacia l Crisis  Banking crisis  S peculative bubbles and crashes  International financial crises  Wider economic crises

Financial crisis a The term financial crisis is applied broadly to a variety of situations in which some financial institutions or assets suddenly lose a large part of their value a banking panics, recessions, stock market crashes, the bursting of other financial bubbles, currency crisis, and sovereign defaults

Financial Crisis  The term financial crisis is applied broadly to a variety of situations in which some financial institutions or assets suddenly lose a large part of their value.  banking panics, recessions ,stock market crashes , the bursting of other financial bubbles, currency crisis, and sovereign defaults

Banking crisis a bank run when a commercial bank suffers a sudden rush of withdrawals by depositors this is called a bank run a banking panic: a situation in which bank runs are widespread is called a systemic banking crisis or just a banking panic. a credit crunch: a situation without widespread bank runs, but in which banks are reluctant to lend because they worry that they have insufficient funds available is often called a credit crunch

Bank C ingrisis  b kan run:wh i l b k ff hen a commercial bank suffers a sudden rush of withdrawals by depositors, this is ca ed a ba u lled a bank run.  banking panic:a situation in which bank runs are widespread is called a systemic banking crisis or j t b ki i just a banking panic.  credit crunch: a situation without widespread bank runs but in which banks are reluctant to bank runs, but in which banks are reluctant to lend, because they worry that they have insufficient funds available, is often called a credit crunch

peculative bubbles and crashes a Economists say that a financial asset (stock, for example) exhibits a bubble when its price exceeds the value of the future income(such as interest or dividends) that would be received by owning it to maturity

Speculative bubbles and crashes  Economists say that a financial asset (stock, for example) exhibits a bubble when its price exceeds the value of the future income (such as interest or dividends) that would be received by owning it to maturity

International financial crises a When a country that maintains a fixed exchange rate is suddenly forced to devalue its currency because of a speculative attack, this is called a currency crisis or balance of payments crIsIs

Internationalf l inancial crises  When a country that maintains a fixed exchange rate is suddenly forced to devalue its currency because of a speculative attack, this is called a currency crisis or balance of payments crisis

Wider economic crises a recession: a downturn in economic growth lasting several quarters or more is usually called a recession a depression: An especially prolonged recession may be called a depression n economic stagnation: a long period of slow but not necessarily negative growth is sometimes called economic stagnation

Wider economic crises  recession:A downturn in economic growth lasting several quarters or more is usually called a recession  depression:An esp yp g ecially prolonged recession may be called a depression  economic stagnation:a long period of slow but not necessarily negative growth is sometimes called economic stagnation

Causes of Financial crisis a Leverage: borrowing to finance investments, is frequently cited as a contributor to financial crises n Asset-liability mismatch: asset-liability mismatch a situation in which the risks associated with an institution 's debts and assets are not appropriately aligned

C f lC auses o f Financia l Crisis  Leverage:borrowing to finance investments, is frequently cited as a contributor to financial crises  Asset-liabilit y mismatch:asset-liabilit y mismatch, a situation in which the risks associated with an institution's debts and assets are not appropriately aligned

Causes of Financial crisis a Regulatory failures: failures of making sure institutions have sufficient assets to meet their contractual obligations through reserve requirements capital requirements and other limits on leverage a Fraud: companies have attracted depositors with misleading claims about their investment strategies or have embezzled the resulting income

C f lC auses o f Financia l Crisis  Regulatory failures:failures of making sure institutions have sufficient assets to meet their contractual obligations, through reserve requirements, capital requirements, and other limits on leverage  Fraud:com panies have attracted depositors with misleading claims about their investment strate gies, or have embezzled the resulting income