The nature of financial crises. Central banks, credit bubbles and the misconceptions of an efficient market

"The nature of financial crises" represents a convincing analysis of the forces behind the current financial crisis. A series of disarming his simplicity of George Cooper"s arguments challenges the key principles of the generally accepted economic theory of our time, explaining why financial markets will not obey the principles of an effective market described in modern textbooks in economics, but, on the contrary, are characterized by internal instability and inclination for the formation of crises.
The author describes the evolution of the modern monetary system, explaining how financial instability is emerging and why this instability demanded the development of the Institute of Central Banks. Cooper argues that the erroneous faith in the power of the free market has led a number of central banks to neglect their key role regulating the financial system and in return caused that they began to pursue a policy leading to a series of even more sharp rates and recession cycles. The nature of financial crises calls for a radical change in the strategies of central banks, the abandonment of establishing the limits of inflation and the change in our attitude towards economic policy