Question
Q5: Consider the GFC of 2008 a/ Why were mortgage backed securities (MBS) considered toxic? Explain your diagrams and answer in words. (5 marks) b/
Q5: Consider the GFC of 2008
a/ Why were mortgage backed securities (MBS) considered toxic? Explain your diagrams and answer in words. (5 marks)
b/ What caused MBS to rapidly lose value? Explain your answer in words. (5 marks)
c/ Explain why quantitative easing to stabilize the US economy was considered a moral hazard (i.e., why will QE paid in 2008 will cause future banks to behave badly). (5 marks)
d/ Australia has reduced its foreign US currency reserve holdings since 2008? Should Australia continue to do this given its current $1 trillion (approximately) debt situation? Explain your working and answer in words. (10 marks)
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Public Administration And Law
Authors: David H Rosenbloom, Rosemary O'Leary, Joshua M Chanin
3rd Edition
1439803986, 9781439803981
