The financial crisis of 2008 shook up the world and was coined as the worst financial crisis since the 1930’s Great Depression. Only a year later, the European Sovereign Debt Crisis destabilized the financial market as it came out that the debts of some countries, like Greece, exceeded their GDP. Are these crises really over? Or is the next crisis just only one step away? By way of lectures, participation in workshops and writing a paper, participants obtain insight in these issues while formulating solutions for a more sustainable financial system.
This course not only deals with the causes and effects of Financial Crisis, the Euro crisis, and Brexit on the global economy and Europe and on European Financial and Securities Law but also discusses the risks of a next financial crisis sparked by the Brexit and the weak financial position of several Italian banks and Deutsche Bank.
The Financial Crisis was caused by, amongst others, an inefficient regulation of securitization (of mortgage products) and poor governance of banks. The Financial Crisis and Euro crisis showed the effects of the lack of rules and tools for regulators on the European economy. On the 8th of September 2011, EC commissioner Reding held a speech about the economic cooperation of the EU Member States and the euro during which she said: “The creation of the euro added to this - during the last 10 years - an unprecedented period of benefits. The establishment of the European Monetary Union constituted a major change in macroeconomic conditions, especially for those Member States previously experiencing high or volatile rates of inflation. Disruptive nominal exchange rate fluctuations between European Monetary Union members disappeared, thereby facilitating trade and investment. The removal of exchange-rate risk and transaction costs further fostered financial and product market integration, while greater price transparency helped consumers and businesses to make better-informed economic decisions and take fuller advantage of the internal market. Unfortunately, in some Member States the new stable low interest rate environment was not used to improve public finances and productivity but rather resulted in unsustainable public and private spending.”
She also mentioned that the number and the scope of reforms that the EU has agreed on since the beginning of the crisis are truly impressive: “Following the turbulence in the sovereign debt markets in spring last year, the EU quickly created financial backstops for countries under market pressure (…). We have put in place a new architecture for European financial supervision. This transformation was a first step towards more Europeanization of the supervision of financial markets and more efforts towards greater Europeanization and centralization have been taken. Recently, the Single Supervisory Mechanism has been established for the banking sector as a result of which the supervisory tasks of the national supervisors are taken over by the European Central Bank (ECB) in relation to significant banks. These developments make the European supervisory landscape extremely dynamic, with an entwining of European and national authorities.
The course addresses both rulemaking for the financial markets and noteworthy financial law and financial regulation. The aim of this course is to establish a broad and complete foundation of knowledge of the laws and rules which have been triggered by the crisis in the European financial markets and an understanding of the permanent interaction between market behavior and the legislators’ and regulators’ responses to this through practical examples.
Participants will get thorough insights into these issues through participation in lectures and workshops. The assignment will stimulate participants to come up with solutions for a more sustainable financial system.
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