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By Cristina Tanasescu


This paper identifies some special characteristics of the current recession. First, it began as a crisis of debt and of asset price inflation. Second, it represents a regulatory crisis. The explosion of complex (and unregulated) financial instruments in a high debt environment exacerbated the crisis of debt. Following immediately from this and, third, it represents a massive imbalance in the global economy and a credit crunch. Forth, it represents a collapse of demand and, following from that rising unemployment. Finally, the rising unemployment exacerbates the debt crisis. This completes a vicious cycle. This paper, also, explains the crisis in the view of Kondratieff cycle. It identifies also some possible response to the financial crisis. The current cycle most likely peaked in 2000 with a possible winter phase beginning in late 2008.global financial crisis, debt crisis, Kondratieff wave cycle

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