Balance Sheet Crises: Causes, Consequences, and Responses
A case study is presented on the topic of balance sheet crises. The authors examine the preliminary events and consequences of the U.S. housing bubble and collapse, argue that the 1929 Great Depression and the Great Recession of 2007 were household-bank balance sheet crises, and fiscal responses to financial crises. It discusses housing, mortgage credit, and foreign capital inflows prior to the Great Depression and Great Recession, gross domestic product (GDP), and securities and mortgage rules.
Gjerstad, S., & Smith, V.L. (2013). Balance sheet crises: Causes, consequences, and responses. Cato Journal, 33(3) 437 - 470.