Text B The Financial and Macroeconomic Crisis of 2008 and Beyond（第1页）

TextBTheFinandMaicCrisisof2008andBeyond

PaulM。Romer

Pre-reading

PaulM。Romer（1955-　）isanAmeriistarepreneur，tlytheprofessorofeicsattheSternSchoolofBusiNewYorkUy。Heisapienousgrowththeory。RomerearnedaB。S。inphysi1977andaPh。D。inei1983，bothfromtheUyofChicago。HetaughtattheUyofiaatBerkeley，theUyofChidtheUyofRochester。HewasnamedoneofAmerica’s25mostiialpeoplebyTimeMagazinein1997。RomerwasawardedtheHorstClausRerizeinEiporarilyleftacademia，foghisenergyonhis2001start-uppanyAplia，ur2007bygageLearning。

&importantworkisinthefieldofeicgroublishedin1986and1990amoumathematicalrepresentationsofeiesinwhiologigeistheresultoftheiionalasofpeople，suchasresearddevelopment。Thisstartedendogenousgrowththeory。

ThefollowiheepiloguefromthelatestAdvanics。

Promptsf

1。Doyouknowanythingaboutthe2008financialcrisis，orthefinanami?Ifhingaboutthiscrisisbeforeythepassage。

2。HaveyouheardofJohnMayarehismais?

3。NearlyalldisaiustbeginwithKeynes。DoesRomerdothesameinthispassage?Whyorwhynot?

4。WhatarethethreeleadiioModeration?

5。Romerclaimsthat“theevefewyearsrofoundshootjusttothemay，butalsotothefieldofmaiyoufiailssuppthisthepassage?

6。Romerpoihevulyoffinancialmarketsaipriewithfuals。Howdoesheelaborateit?

7。WhydoesRomerbelievethatthecrisismakesaparticularlyexdparticularlyimportant，timeformaics?Whatdoyouthinkaboutthedevelopmentofmaics?

8。Whatisthegenerallogidtheanizatiohispassage?Workoutanideaflowcharttoillustratetrainofthoughtinthispassage。

9。Howdoestheauthorachievebeingadbeithesametime?

[1]TheperiodfromtheendoftheVolcker1disinflationinthemid-1980sto2007wasoneofuedmaicstability。Theueswentthroughonlytworesihofthemmild。Theueneverexceeded8perdtherewereoersinfell。

[2]TherearethreeleadiionsofthisGreatModeratioissimplygoodlutheformofsmallershogtheey。Thesedisthestructureoftheey，suchasalargerroleofservidimprovementsiemehirdisimprovedpolipolicymakerswereuheodeloftheeyasofinflatioedlypursuedpoliciesthatflatioheninducedrestoreduceit。Withthetriumphofthenaturalratehypothesis3，geoicestimatesofthenaturalrate，andtheemergenceofasusthatinflationshouldbekeptlow，thisboom-bustcycledisappeared。

[3]Thisperiodofstabilityei2008—thoughwhethertheendoraryorpermayetknown。Housepriceshadbeenrisingrapidlysie1990s。By2003，boththelevelofrealhousepridtheratioofthepricesofexistihecostsofbuildingnewoheirpreviousphs。Yettherapidpricreasesuedforthreemoreyears。Theincreasesaniedby—andperhapsfueledby—thegrowthofgages，manyofthemissuedonthebasisoflittleoriooftheborroroliferationofneadinsurigages，ofteunclearwhtheriskofdefault。

[4]Housepricesstartedfallingin2007，andthemayweakehereafter。Thedethevalueofhousisreduetworthofmanyfinanstitutionsandiaintyaboutthath，asignifitstraimarkets。Forexample，spreadsbetweeeshtloaweenbanksaesorosesharply，andtheFederalReserve4aralbaoilyimarketsinvariousways。Buttheinitialdownturninthemaild。Forexample，asofAugust2008，aohattheeyrobablyithatanyrewaslikelytobeeveheprevioustwo。

[5]Iember2008，however，LehmanBrothers5，amajoribank，dekrupttheaftermath，financialmarketssuffereddramaticturmoil，andtheregedfrommildtosevere。Equitypricesfellbymorethainjust4weeks;spreadsbetweeesoionalbutslightlyriskyloansahesafestandmostliquidassetsskyrodmanyborrowerswereuoborrowatae。RealGDPsuffereditslargesttwo-quarterdece1957-1958;aember2008toMay2009，employmentfellby3。8perdtheueroseby3。2pertagepoints。Bymostmeasures，thereof2007-2009wasthelargestsinceWorldWarII。Mariessufferedsimilardownturns。

[6]Theinitialpartoftherecoveryhasbeenslow。Inadditivieloymentwillremaiuralrateandoutputwillremaisnormallevelforyears，andthattheeventsof2008and2009mayhavelosonthenormallevelsofuandoutput。Aeddebateaboutwhat，ifanything，policymakersshoulddotospeedtheredredudamage。

[7]Theevefewyearsrofoundshootjusttothemay，butalsotothefieldofmaics6。Shateflus，whichwethoughtwehadlargelytamed，havereemergeddramatically。Moreover，theheretreisverydifferentfromthatofothermajorpostwarres。Finaioohavebeeral，andtightmoarypolicyplayedlittleornorole。

[8]Thusourmodelsandanalysiswillsurelyge。Buthowisnotmanyways，maicstodayisinapositionsimilartowhereitstoodintheearly1970s，whentheemergeionofhighuandhighinflationgedacceptedviews。Then，asnow，onepossibilitywasthattheueddevelopmentswouldleadonlythtforwardmodifisoftheexistianotherpossibility—ainfactoccurred—wasthatthedevelopmentswouldleadteaedthefield。

[9]Obviously，redidamentalmaicsbeforetheyoccur。Allwedoisidehekeyissuesthatthecrisisraisesforthefieldandsomepossiblediresofresearch。

[10]Severalofthetralissuesinvolvefinancialmarkets。Oahecrisisisthevulyoffinancialmarketstoruns。Manyfinanstitutioermdebttofiermiheextremeisatraditionalbank，whichissuesdemasandholdsavarietyoflos，sues。Whyfinanstitutionsengageinsuchmaturitytransformation7，aermtractstakesuchsimpleforms（su-tdebtpayableondemand），areplicatedquestions。Butgiventhesearrahereisastrtocreatemultipleequilibriums:adebtholderismorelikelytodemandthatthedebtberepaidorrefusetorollitoverifheorshebelievesthatotherswilldothesame。Theretcrisisshowsthatthislogicappliesnotjusttoatraditionalbank。Italsoappliestoafinanstitutionfinahroughcollateralizedhtlhshort-termdebttracts。

[11]Aneofthegfinancialmarketsisthattherearelimitstipriewithfuals8。Forexample，housepricesbeforethecrisisappeartohavebeehelevelswarrantedbylikelypayoffsiesoftheworld;andthesameistrueofthepricesofvariousassetswhosepayoffsweretiedtothehousi，suchasme-backedsecurities9。Ihosesecurities，onedifficultywasthatcredit-ratingagenciesfoevaluatingtheprobabilityofdefault，andesiwouldodthereisevidepriayhaveswitsohecrisishit，withmanyriskyassetssellingatpricesbeloarrantedbyfuals。Ifanindividualbelievesthataismispriced，heorshehasaotradeinaushpricesbacktowardfuals。Butmisprigsofthetypeswehavebeendisgdorageopportuis，iegiesthatwillbeprofitablewithty。Iradesthatmovepricesbacktowardfualsinvolverisks，besialsaionsofthemisprisideraemplatingbuyilyusiofthecrisis。Iftheapparentpaensifybeforesubsidihtbeforcedtoliquidatehisorherposition，andsoincuralossihesituatioheeywasdeterifurtherandthemarginalutilityofptioneciallyhigh。Thisrisklimitstheior’sdemandfortheu，andsobluntstheforgpricestowardfuals。Ifthespecializediorsttoprofitfrarefisidecapital，theirsituationisevenmorediffiderpricedassetsaretypieswhoseretreturnshavebeenlow。Asaresult，specializediorsmayfindthattheamountoffuainfromsislowerwhenmisprigisgreater。

[12]Thecrisisalsoshowsclearlythatfinancial-marketimperfeportantnotjusttos，butalsotofinancialfirms。Muanvolvestwolevelsofimperfeebetweeeuserofthedafinantermediary，aweeermediaryaeproviderofcapital。Mostanalysesoffinancial-marketimperfeorethisfadfoetriatioimateusersandtheprovidersoftheircapital。Butasymmetriatiohefinantermediariesaeprovidersappearstohavebeeantduringtheple，manyfinancialfirmshadextremedifficultyobtainingcapital，atheiivesfagfirmsclosetobankruptcyappeartohavebeenamajorsourceofthisdifficulty。

[13]Anotherissueinvolvingfinancialmarketsraisedbythesthetransmissio-marketdisruptiooftheey。Thecredit-marketturmoilinthefallof2008wasfollowedbyaquidrapiddeeicactivity。Someofthedeewasclearlyduetothedirecteffectsofthedisruptions。Firmsthatwereuvestmesandcutbaventories;householdsthatesdidnotbuyerswhooloaiceledorders;andhouseholdswhosewealthhaddeedreducedtheiriicsoftheseeffectsareshownbythemodelofihepresenancial-marketimperfedthemaplisareiheextensionsofbusioincorporatefinancial-marketimperfes。

[14]Yettheseanalysesareileasttwoveryimportantways。First，wekhemaghedifferentels。Forexample，wehavelittleevideheimportanperfetherelatioweenfinancial-marketinstitutionsandtheirsuppliersoffuothatofimperfetherelatioheseinstitutionsandtheirborrowers。Likelittleaboutwhetheritiseffeday-to-daylending，susforpayrollaory，oreffethefinangerprojects，suewhomesandfactories，thatareespeciallyimportant。Seeoftheimpactofthedisruptioohaveoperatednhtheirdirecteffects，butthroughmoreamorphouseffethe“ce”ofhouseholdsandfirms。Givehedowerminingtherolesofthesevariousfadtheelsthroughwhichtheyoperatedisanimportanttask。

[15]Thecrisishasalsoraisedarangeofissueslessdirectlyrelatedtocreditmarkets。Ithasmadeclearthatthezerolowerboundonnomiesisacrustraiarypolicy。Thereislittledoubtthatihet，theFederalReserveandmaralbankswouldhaveterestratesmuchmorethantheydid，andthatthedownturnwouldhavebeenlesssevereandthereuchmorerapid。Thusthecrisiselevatestheimportanceofissuesrelatedtothezerolowerbound。

[16]Amorespeculativeviewisthattheportaiyissuesfboththeshocksthatgiverisetoflusandthepolisesthathaveimportantimplisfortheiryulatorydesbeforethecrisis，aswellassomeofthemiaicpolisduringthecrisis，seemdiffiderstandwiththetraditionalviewofpolicymakersasknowledgeableaogiveoneexample，beforethecrisishit，therewerewarningsignsofovervaluedassetpriehighlyquestio-marketpractices;yetpolicymakersdidlittleinresponse。

[17]Thislistofissuesthatthecrisisraisesformaicsisfarfromplete。Othersihereashtto“liquidity”10iofinancialturmoil，aswellasthemeaningandimportaheveryceptofliquidity;thetralbank’sroleasaleresort;howvariousfissaffectthemayirun;therolesn-cyreserves，exge-rateregimes，aorsiermininghowacrisisistransmittedatries;theseeminglypuzzlinglysmallfallininflatithedwhatthatihestructureoftheeyaheoriesofinflatioudeasofthelongtermmaiceffeancialdmuchmore。Ihefewsilverliningsofthecrisisisthatitmakestodayaparticularlyexdparticularlyimportant，timeformaics。

Notes

1。PaulVolin1927，oftheFederalReserveusJimmydRanfrom1979to1987。HewasthechiefarchitectoftheU。S。abahegold-exgestandardaionsoftheU。S。dollar。Hehelpedlowerdouble-digitinflatioheearly1980sandusheredinaneraoffiionandinnovation。