Role that credit default swaps played in financial crises

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Reference no: EM131091413

1. Calculate the real interest rate over the past 24 months using the 30 year Treasury bond rate as the nominal interest rate and assuming that expected inflation was equal to actual inflation (based on the change in CPI). Make sure to include the fisher equation.

2. Explain 4 of the 8 basic facts and what it means for our financial markets.

3. Explain the role that credit default swaps played in the financial crises.

4. Explain 4 other things that led up to the financial crises and their impact on the financial markets, housing, prices and GDP.

5. Loooking at the FED. balance sheet, discuss 3 assets that have increased significantly since the financial crises and why?

6. Using the spread between the 90-day T-bill rate and 10 year government bond over the past 24 month, calculate and graph the yield curve.

7. In your own words, explain rational expectations.

Reference no: EM131091413

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