NAŠE GOSPODARSTVO / 
OUR ECONOMY

From Subprime and Eurozone Crisis with Full Speed into the Next Financial Crisis

Sebastjan Strašek

Abstract


This paper offers an analysis of the road from subprime and eurozone crisis to
the elements of a new systemic crisis. Our aim is to research common issues
that accompany each of these crises and to explore elements that hint that
the financial systems are moving toward a new crisis. By holding short-term
interest rates near zero, the central banks have encouraged malinvestment and
speculation. Fuelling the bubble is the fear of missing out on trade. We find that
actual events and movements on security markets follow a typical pattern, which
indicates a serious threat for the next financial crisis. We also find enough signs
that old crises lessons haven’t been learned.


Keywords


financial crisis, bubble, P/E ratio

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