The Financial Crisis: One Decade On: Introduction

The financial crisis started ten years ago when BNP Paribas closed three funds in August 2007, temporarily as it turned out, when they argued that it was no longer possible to value accurately the portfolios of assets and liabilities. From that date interbank markets froze (figure 1) and to some great extent are still in the midst of an Ice Age. Liquidity between private agents was severely restricted and the public sector was asked to step in and provide financial support. That early shock, like the fall of Credit-Anstalt in 1931, triggered a sequence of events from which ten years after we can still observe the repercussions. In this special issue we examine many of the resulting debates for monetary, fiscal and financial policy.