The Extent to which Financial Crises are Occasional and the Role of Collateralised Derivatives in the Global Financial Crisis
The article aims to explore to which extent financial crises occur periodically and under what particular conditions, or whether they are occasional and unpredictable. By recalling some of the financial crises from the last century, using historic and systematic approach of investigation the article analyses the factors and the events which stimulate a financial crisis. Particular attention is pointed at the last global financial crisis and one of its reasons, namely the collateralisation of the derivatives of mortgage loans on the US property market. In this regard, different factors are compared, such as the partabolishment of the Bretton Woods agreement and its replacement with a floating currency system, the development of new innovative financial products, the deregulation of the financial markets and the increase of debt in the private sector. The work examines common patterns stimulating financial crises and at the end gives answers to what extend financial crises can be predictable.
