What Crisis is This?

By Marcel Bursztyn

In his book "What Crisis is This?", Marcel Bursztyn takes readers on a journey through the history of financial crises, from the earliest recorded instances to the most recent global financial crisis of 2008. Bursztyn argues that financial crises are not simply random events, but rather the result of a combination of factors, including human greed, recklessness, and a lack of regulation.

A History of Financial Crises

Bursztyn begins by examining some of the earliest recorded financial crises, such as the collapse of the Roman Empire and the Great Depression of the 1930s. He shows how these crises were caused by a combination of factors, including excessive lending, speculation, and a lack of regulation.

Bursztyn then turns to more recent financial crises, such as the Asian financial crisis of 1997 and the global financial crisis of 2008. He argues that these crises were also caused by a combination of factors, including excessive lending, speculation, and a lack of regulation.

The Causes of Financial Crises

Bursztyn identifies several key factors that contribute to financial crises. These include:

• Excessive lending: When banks and other financial institutions lend too much money, they increase the risk of a financial crisis. This is because when borrowers are unable to repay their loans, the banks and other financial institutions can suffer losses.
• Speculation: Speculation is the practice of buying and selling assets in the hope of making a profit. When speculation becomes excessive, it can lead to a financial crisis. This is because when asset prices fall, speculators can suffer losses.
• A lack of regulation: A lack of regulation can also contribute to financial crises. This is because when financial institutions are not properly regulated, they can take on too much risk.

The Consequences of Financial Crises

Financial crises can have a devastating impact on the economy. They can lead to job losses, bankruptcies, and a decline in economic growth. Financial crises can also lead to social unrest and political instability.

Preventing Financial Crises

Bursztyn argues that financial crises can be prevented by taking steps to address the factors that contribute to them. These steps include:

• Regulating the financial industry: Financial institutions should be subject to strict regulation to prevent them from taking on too much risk.
• Educating investors: Investors should be educated about the risks of speculation.
• Promoting economic growth: Economic growth can help to reduce the risk of financial crises by providing borrowers with the means to repay their loans.

Conclusion

"What Crisis is This?" is a must-read for anyone who wants to understand the history of financial crises and the steps that can be taken to prevent them. Bursztyn's book is a well-written and informative account of one of the most important issues facing the global economy today.

Call to Action

If you are interested in learning more about financial crises, I encourage you to read "What Crisis is This?" by Marcel Bursztyn. This book is a valuable resource for anyone who wants to understand the history of financial crises and the steps that can be taken to prevent them.