Page 49 - Azerbaijan State University of Economics

S.A.Najafov: Debt rigidity crisis

Debt rigidity problem is urgent for US and European countries too. Taking into

consideration near-zero interest rate in US and euro area it is obvious that expected

rise in interest rate will decrease the value of securities banks hold and so will

provoke banking crisis.

References

[1] Koo, R. 2011. The world in balance sheet recession: causes, cure, and politics.

Real-world economics review, issue no. 58, pp. 19-37

[2] Minsky, H. 1980. Capitalist Financial processes and the instability of Capitalism.

Journal of Economic Issues, No. 2, pp. 505-523

[3] Mises, L. 1912. The Theory of Money and Credit

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