분야
ppt2.Could you suggest a current suspected asset buble?
3.Is it likely to burst soon ?
4.Is it harmful to an economy?
Garber, P.M. (2000): A bubble is present when the price of an asset differs significantly from its fundamentals.
Kane, Edward and Kindleberger, Charles (2004): bubbles appear in the last stage of an economic boom, when expectations are irrationally optimistic.
Kindleberger and Aliber, (2005):“an upward price movement over an extended period of 15 to 40 months that then implodes.” and “in the 20th Century most of the manias and bubbles have centered on real estate and stocks.”
magnitude of change of the asset price exceeds 40%
The bursting of a bubble is accompanied by recession, low inflation (even deflation).
Irving Fisher (1911), John M. Keynes(1936), Milton Friedman (2003):
Asset Price: Interest Rate, Inflation Rate, Risk Premium,
Expected Growth
Money
Weaknesses in the global financial system
The crisis has, indeed, unveiled serious weaknesses in the functioning of our global financial and economic system. Serious regulatory and policy mistakes that have persisted for many years have contributed to the severity of the problem. Economic risks have been seriously underestimated in the pricing of financial assets and asset bubbles have persisted for too long, supported by an abundance of liquidity. Macroeconomic imbalances have developed in a global economy without any serious attempt to address them through coordinated action. The emerging economies have not been integrated adequately to the system of global economic governance. These weaknesses were apparent in minor crises that have taken place in the past.
Is it harmful to an economy?
Direct Channel: Capital
