Masterclass tackles financial crisis

31 Oct 2011     Last updated: 20 Jun 2014

The Centre for Economic Empowerment’s second masterclass tackled the complex and wide-ranging topic of what caused the global financial crisis and examined the policies that resulted from it. The event was addressed by Dr Esmond Birnie, PwC Chie

The two speakers agreed on much of the origins of the crisis, notably that:

  • global financial market investments became increasingly driven by unprecedented levels of leveraged bank debt;
  • this was coupled with too little or weak banking regulation and ever more complicated financial instruments/derivatives;
  • which lead to a domino collapse in the global banking system catalysed by defaults in the sub-prime mortgage market in the US;
  • This was all possibly driven by a prolonged period of low interest rates and personal debt.

The banking collapse resulted in a period of public bailout by Governments, which has subsequently turned a ‘private’ banking crisis into a sovereign debt crisis in Europe, as certain Governments have had to borrow on the financial markets to prop up their banks, and are struggling to make repayments and  run their States.

Dr Esmond Birnie’s presentation focused on a chronological overview of the crisis while Dr Andrew Baker’s focused on different interpretations of the crisis and how competition over the meaning of the events will dictate what type of policy changes governments implement.

The presentations led to a very interesting discussion among the speakers and attendees on the underlying explanations and appropriate responses to the crisis.  Perspectives from market fundamentalism, to social democratic regulation, to corruption and structuralist anit-capitalism, were explored.

Speaking after the masterclass Lisa McElherron, NICVA Head of Public Affairs, said:

This masterclass tackled the issue that is consuming much of the world at the moment and whilst at times it can feel very far away from our daily work, this masterclass made it clear that the crisis is affecting all of our lives and will dominate economic and social policy for years to come.

“For this reason it is extremely important that the voluntary and community sector is as informed as possible to what happened and is able to interpret, criticise or support resultant government policies that will impact on the people they represent.

“The fact that we had some 40 people wanting to discuss this issue shows the appetite within the sector to better understand and influence economic debate."

Dr Esmond Birnie’s and Dr Andrew Baker’s presentations are available here.

The next masterclass will take place on November 18 and will examine gender budgeting, you can find out more information and book a place here.

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