| Unit name | Financial Crises |
|---|---|
| Unit code | EFIM30018 |
| Credit points | 10 |
| Level of study | H/6 |
| Teaching block(s) |
Teaching Block 1 (weeks 1 - 12) |
| Unit director | Dr. Pedio |
| Open unit status | Not open |
| Pre-requisites |
50% in Corporate Finance (EFIM20006) |
| Co-requisites |
None |
| School/department | School of Accounting and Finance - Business School |
| Faculty | Faculty of Social Sciences and Law |
This unit starts by describing various types of financial crisis, providing historical illustrations. It goes on to examine explanations of these crises, with particular emphasis on the asset price bubbles and busts which often precede them. The 2007 credit crisis will be analysed in depth, especially the roles of financial engineering and securitization, as exemplified by the proliferation of asset-backed securities such Collateralised Debt Obligations and credit derivatives such as Credit Default Swaps. Finally, it explores the consequences of crises and briefly examines policy issues.
On successful completion of this unit a student will be able to:
Teaching will be delivered through a combination of synchronous and asynchronous sessions including lectures, tutorials, drop-in sessions, discussion boards and other online learning opportunities
This unit will be assessed by 100% individual coursework
The course will draw primarily on the following survey articles:
Claessens, S. and M.A. Kose, 2013, “Financial Crises: Explanations, Types, and Implications”, IMF Working paper WP/13/28
Scherbina, A., 2013, “Asset Price Bubbles: A Selective Survey”, IMF Working paper WP/13/45
Other articles will be discussed during the course.
For CDO and CDS pricing we will use extracts from:
McDonald, R., “Derivatives Markets”, Pearson
Hull, J., “Options, Futures and Other Derivative Securities”, Prentice Hall
