I begin by describing the factors that contributed to the financial market crisis of 2008. I end by proposing policies that could have prevented the baleful effects that produced the crisis.
Topic:
Democratization, Economics, International Trade and Finance, Markets, Privatization, and Financial Crisis
So many well-deserved tributes have been paid to the memory of Milton Friedman that I propose to pay him tribute in a special way by talking about my long association with him. Before I do so, I note his activities before the 1950s, when we started working together. For the record, Friedman was not a monetarist when our collaboration began.
The International Monetary Fund has proposed a universal bankruptcy tribunal to deal with sovereign debt restructuring. But does the international financial system really need such a mechanism? There has been little demand by sovereign borrowers or their creditors for a universal bankruptcy law, and few countries have had to enter into debt restructuring procedures. The absence of such a law does not appear to have created chaotic conditions even in those cases.
Topic:
Economics, International Organization, International Political Economy, and International Trade and Finance