Have We Left the Financial Crisis Behind?
In the introductory lecture of his course Global Financial Crisis, Andrew Metrick describes how the financial panic of 2008 and the ensuing recession have created a new economic reality.
The financial crisis of 2008-09 may have occurred six years ago, but it has yet to recede into history. Its impact lingers—in stubborn unemployment, sluggish economic growth, and a realization that the costs of the crisis have still not been recouped and may never be. It's safe to say that the financial crisis is the defining economic event of our time.
A new course at the Yale School of Management is putting the crisis into a global context for students. Titled Global Financial Crisis and co-taught by Andrew Metrick, Michael H. Jordan Professor of Finance and Management, and former treasury secretary Timothy Geithner, the course surveys the causes, events, policy responses, and aftermath of the largest global financial cataclysm since the Great Depression. The main goal is to study what has been called the Great Recession in such a way that students—who come from throughout the university—gain a better appreciation for the dynamics of financial crises in a modern economy.
"Whenever you hear, 'We can stop financial crises forever if we just do x, y, and z,' none of that is ever possibly going to be true," Metrick said. "If at any point in time people get sufficiently nervous, which can happen even in the Space Age, we will have a panic and a financial crisis. There's no secret formula."
Geithner will deliver three lectures in the course, which meets once per week, with Metrick leading the class on the other days. The talks are also this year's Arthur M. Okun Public Policy Lectures, which are sponsored by the Yale Department of Economics and honor Arthur M. Okun (1928-1980), a longtime professor of economics at Yale who is best known for the widely accepted economic principle Okun's Law.
The course will also boast several prominent guest lecturers, including Robert Shiller, Sterling Professor of Economics, on subprime mortgages; John Geanakoplos, James Tobin Professor of Economics, on policy responses to the crisis; and Roberta Romano, Sterling Professor of Law, on the Dodd-Frank financial reform legislation.
Check back throughout the fall for further excerpts from the course.