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Stability in International Finance

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Why are international fi nancial systems unstable? To understand this, one must use
a proper model for a fi nancial market—a model which is not just normative but
empirically valid. The traditional market model of price-equilibrium, while valid for
commodity markets, is not empirically valid for fi nancial markets. Instead, fi nancial
markets must be understood in a price-disequilibrium model. A price- disequilibrium
model traces back to the studies of Irving Fisher, John Maynard Keynes, and Hyman
Minsky.
We present here a three-dimensional supply-demand model which can depict
how, over time, a fi nancial market can move from a price-equilibrium toward pricedisequilibrium, due to speculation—a fi nancial bubble.
Financial bubbles occurred in the Asian Financial crisis in 1989, the Global
Financial crisis in 2007–2008, and the Euro crisis of 2010–2015; and these bubbles
have depressed national economies. They recur, despite the sophisticated
information- communications technology of the modern Internet. Why?

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Detail Information

Series Title

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Call Number

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Publisher

London : Springer., 2016

Collation

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Language

English

ISBN/ISSN

978-3-319-26760-9

Classification

NONE

Content Type

text

Media Type

computer

Carrier Type

online resource

Edition

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Subject(s)

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Specific Detail Info

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Statement of Responsibility

Frederick Betz

Other Information

Cataloger

Jemadi

Source

https://link.springer.com/content/pdf/10.1007/978-3-319-26760-9.pdf?pdf=button

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