The Watershed Year of 2004: Origins and Causes of the Crisis

  • Adrian Blundell-Wignall
  • Paul Atkinson
  • Caroline Roulet


The authors focus on causality in the narrow sense of place and time: the preconditions for the crisis were global, but it all started in the USA and traced back to 2004. They argue that structural features of the US, including the role of Fannie Mae and Freddie Mac and SEC regulatory changes, were instrumental in the sharp acceleration of leverage and mortgage-backed securities (MBS) origination. They ask why bank management was unable to contain excessive risk and use corporate governance indicators for key US banks, and examples from Europe, to explain the dangerous equity culture in play. They argue that corporate governance cannot substitute for sound rules concerning leverage and what banks do with respect to their business models—models that led to the ‘Lehman Moment’.


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Copyright information

© The Author(s) 2018

Authors and Affiliations

  • Adrian Blundell-Wignall
    • 1
  • Paul Atkinson
    • 2
  • Caroline Roulet
    • 3
  1. 1.University of Sydney and OECD (consultant advisor to the Secretary General, and former Director of the Financial and Enterprise Affairs Directorate)ParisFrance
  2. 2.NHA Economics, Ltd.ParisFrance
  3. 3.Organisation for Economic Co-operation and DevelopmentParisFrance

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