The authors are among the first to trace the subprime crisis – which is not, in their opinion, comparable to that of 1929 – to measure its severity, and then to identify the winners and losers. They propose new ways to regulate financial markets and the creation of new financial vehicles. They believe that the responsibilities of the crisis are collective, each stakeholder (central banks, banks, regulators, rating agencies, traders, states, savers) having not sufficiently measured both the nature and the extent of the risks of the financialization of the economy. Despite these excesses, the authors nonetheless celebrate the virtues of financial globalization, money creation and fiscal discipline. The outcome of the crisis lies in the common will of the many actors involved to thoroughly reform financial markets and global regulatory systems, to revise IFRS prudential standards (deemed pro-cyclical) and to reorganize the banking sector. This last issue is essential, because banks are major providers of credit to SMEs and households, and therefore, creators of productive jobs. A clear and documented analysis of the ins and outs of the last crisis.
Olivier Pastré and Jean-Marc Sylvestre are respectively university professor and economic journalist.