Course description
The goal of this course is to discuss the 383-year-history of financial crisis through the Great Meltdown of 2008 and continuing to the present pandemic catastrophe. We ascertain recurring historical patterns of financial bubbles from tulips to bitcoins without, however, overlooking critical differences. If history repeats itself, why cant we avoid making the same mistakes repeatedly? The great meltdown happened at a time when most mainstream macroeconomists (including Nobel-Prize-winner Robert Lucas, as well as none other than the former Federal Reserve Chairman Ben Bernanke) were emphasizing that they had business cycles under control. They, along with most of their colleagues, were dead wrong, because they disregarded the warning signs and used the inadequate economic models to assess the situation. The historical evidence enables us to gain a more thorough understanding of global finance which influences our lives to such a great extent. Our primary aim is not to concentrate on facts, theorems, or numbers, but rather to see the big picture in a multi-disciplinary long-run perspective integrating the knowledge gained from the work of such Nobel-Prize-winning behavioral economists as Robert Shiller, Richard Thaler, and Daniel Kahneman. We also assess our current economic situation, including the fallout from the bailout of Wall Street that failed to pay adequate attention to the problems faced by the everyman on Main Street. The course ends with the analysis of the current economic crisis in wake of the COVID-19 pandemic. Students gain an understanding of how we arrived at such a dangerous point in the nations history.
†
