Risk management, financial behaviourism and regulation in relation to Sub-prime crisis

Edina Bacso, Joan Conangla, Michaela Dontu & Adas Lumbe

Studenteropgave: Semesterprojekt

Abstrakt

This paper attempts to look behind the models and search for an alternative aspect to investigate the roots of the current Sub-prime crisis. The concept of rationality will be reviewed and the way how irrationality might arise in the market and within financial institutions will be analyzed from different perspectives. The question, how the government should handle this problem, will be also addressed. To evaluate the rational model implementation, we have considered how CAPM would be implemented in the irrational system, dependent on the number of participants acting rationally and what consequences it might cause. Project will evaluate some of the Acts of the US government, to see their effects for the rationality of the actors in the market and long term influences. The relationship between the trust in rational models and the phases in market cycle will be identified in relation to Kindleberger-Minsky model of bubble formation.

UddannelserErhvervsøkonomi, (Bachelor/kandidatuddannelse) Bachelor el. kandidat
SprogEngelsk
Udgivelsesdato9 jun. 2009
VejlederePoul Wolffsen

Emneord

  • financial institutions
  • risk management
  • crisis
  • Kindleberger
  • CAPM
  • banking system
  • Sub-prime
  • rationality
  • finacial behaviourism
  • finance
  • Minsky