Minsky moment
E764588
A Minsky moment is a sudden collapse of asset prices following a prolonged period of speculative borrowing and rising leverage, as described in Hyman Minsky’s financial instability hypothesis.
Statements (47)
| Predicate | Object |
|---|---|
| instanceOf |
economic concept
ⓘ
financial concept ⓘ macroeconomic phenomenon ⓘ |
| associatedWith |
asset market panic
ⓘ
liquidity crunch ⓘ margin calls and collateral calls ⓘ sudden loss of confidence in debt sustainability ⓘ |
| characterizedBy |
forced deleveraging
ⓘ
loss of market liquidity ⓘ rapid reversal of credit expansion ⓘ sharp fall in asset prices ⓘ |
| describedBy | Hyman Minsky NERFINISHED ⓘ |
| hasCause |
credit-fueled asset bubbles
ⓘ
excessive risk-taking by borrowers and lenders ⓘ overvaluation of asset prices ⓘ prolonged period of speculative borrowing ⓘ rising leverage in the financial system ⓘ shift from hedge finance to speculative finance ⓘ shift from speculative finance to Ponzi finance ⓘ |
| hasDefinition | sudden collapse of asset prices following a prolonged period of speculative borrowing and rising leverage ⓘ |
| hasStageAfter |
period of euphoria in financial markets
ⓘ
period of speculative mania ⓘ |
| hasStageBefore |
asset price inflation phase
ⓘ
credit expansion phase ⓘ |
| namedAfter | Hyman Minsky NERFINISHED ⓘ |
| occursInContextOf |
asset price bubble
ⓘ
credit cycle ⓘ financial crisis ⓘ financial cycle ⓘ |
| partOf | financial instability hypothesis NERFINISHED ⓘ |
| relatedTo |
asset bubble burst
ⓘ
credit boom and bust ⓘ endogenous financial instability ⓘ financial contagion ⓘ financial instability hypothesis ⓘ leverage cycle ⓘ systemic risk ⓘ |
| resultsIn |
banking sector stress
ⓘ
deleveraging of balance sheets ⓘ fire sales of assets ⓘ losses for leveraged investors ⓘ recession risk ⓘ tightening of credit conditions ⓘ |
| timePeriod | term popularized in financial commentary in the late 20th and early 21st century NERFINISHED ⓘ |
| usedIn |
crisis narrative of the 2007–2008 global financial crisis
ⓘ
financial stability analysis ⓘ macroeconomic analysis ⓘ |
Referenced by (1)
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