Financial Crises: Causes, Consequences, Policy Responses and Management

Financial crisis refers to a condition wherein a financial asset unexpectedly loses a significant portion of its nominal value. There are various types of financial crises including stock market crises, external debt crises, banking crises, balance of payments crises and currency crises. A financial crisis can have several causes such as an overvalued asset or institution, which can then be worsened by irrational behavior of the investors. During a financial crisis, asset values endure a sh...