Banks and Financial Crises Flashcards
1
Q
What are the three types of money?
A
- Commodity money
- Bank notes
- Bank deposits
2
Q
What is moral hazard?
A
Those insured against a risk are less likely to do the moral thing
3
Q
Who was Tommaso Contarini?
A
A Venetian Senator who, in 1584, argued banks failed due to risky investment of people’s funds
4
Q
When was the Wall Street Crash?
A
1929, due to the willingness of US banks to lend to stock speculators
5
Q
Which bank marked the beginning of the Great Depression?
A
Creditanstalt, the largest bank in Austria, declared its insolvency in 1931
