Have Financial Markets Learned from Past Crises? (Part II)

Abstract

This second installment of commentary regarding recent financial crises discusses market dislocations over the past year (the first installment focused on market conditions surrounding September 11, 2001). The authors describe the events, and the fundamental and technical forces, that contribute to the current conditions of illiquidity and increased equity, credit, interest rate, and spread volatility. They suggest that in the current environment, more prudent leverage of market participants has mitigated the contagion effects observed in 1998.

Citation

TILMAN, L.M. and RAJADHYAKSHA, A. (2002), "Have Financial Markets Learned from Past Crises? (Part II)", Journal of Risk Finance, Vol. 3 No. 4, pp. 83-87. https://doi.org/10.1108/eb043502