engleski

Asset Prices Boom & Bust Cycles: Methodology and Key Features

Boom and bust cycles in asset prices are often accompanied by credit cycles. These movements can sometimes lead to the periods of financial instability. Moreover, the current global financial crisis can be accounted among the crisis largely connected with the asset markets. There are a large number of empirical researches that explain the connection between the cycles in asset price and credit and financial stability. In this paper we present a new methodology for determining the cycles in asset prices. By this methodology we have defined the cycles in asset prices in the United States and analyzed the specifics of the proposed method of determining the cycle compared to previously used methods. Analysing the events in previous cycles in asset prices, we find the rationale for the proposed method of determining the cycle in order to preserve financial stability.

Asset prices ; boom & bust cycles ; methodology

nije evidentirano