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PAULSON'S PLAN AS A RESPONSE OF U.S. AUTHORITIES TO PROBLEMS OF INVESTMENT BANKS (Plan Paulsona jako odpowiedz amerykanskich wladz na problemy banków inwestycyjnych)

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Antkiewicz S.

Pieniądze i Więź

2009

vol. 12

issue 3(44)

Liberalization and deregulation in a globalized financial market narrowed the possibility of financial institutions' supervision. Risk assessment of particular investments was aggravated. Investment banks have a large impact on the stability of the financial system and their collapse could cause a crisis even in a stable economy. In addition, the speed of information transmission and the scale of linkages between entities facilitate the spread of crises. Currently, the world faces the greatest financial crisis since 30's of the twentieth century. It caused not only the collapse of financial markets, but also translated into a weakening world economic situation and may lead to recession in many countries. The outbreak of the crisis also exposed all the weaknesses of the financial sector. Recklessness and greed of financial institutions led to many errors in their management. Overriding objective was the desire to maximize profits, not attaching due attention to risk assessment. In order to restore liquidity and confidence in the market, the largest central banks around the world have decided to take emergency action, and the governments of many countries have developed programs designed to spur economic growth. The most controversial was the plan to rescue the U.S. financial sector developed by secretary Paulson. It assumed the allocation of 700 billion U.S. dollars of public funds to support private institutions, largely responsible for the outbreak of the current crisis.

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1 Pieniądze i Więź

1 2009

1 Antkiewicz S.

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PAULSON'S PLAN AS A RESPONSE OF U.S. AUTHORITIES TO PROBLEMS OF INVESTMENT BANKS (Plan Paulsona jako odpowiedz amerykanskich wladz na problemy banków inwestycyjnych)