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The financial crisis and its impact on U.S. gross domestic product growth
Cimala, Petr ; Jílek, Josef (advisor) ; Dočkal, Dalibor (referee)
The aim of the thesis is to quantify the impact of the 2008 financial crisis to U.S. economic growth and also identify potential scenarios for future development. For this purpose, there was selected a sample of historical cases of financial crisis where followed the process of deleveraging. Identified impacts were applied to estimate the future GDP growth. In the period 0-5 years after the crisis GDP typically slowed by 40-45%, in 0-7 year horizon by 28-35%, and in the 10 year horizon by 17-20%. In a case of deducting export effect, slowdown of GDP growth is even higher. For the next 8 years average U.S. GDP growth is estimated to 2.26-2.6%. Compared with the pre-crisis period, slowdown reaches 14-25%. Process of deleveraging is now in the one third of the expected duration. The financial sector and household sector remains vulnerable to return the economy into recession and will deleverage further. Non-financial firms are sound. The greatest risk is hidden in the public sector which is experiencing high deficits and uncontrolled growth of debt. Debt is starting to approach level that may reduce long-term dynamics of GDP growth. The future path is in the hands of government officials. Fiscal consolidation treat the root of the problem, but it is painful and hard to approve. Delays in solving the problem is less painful way, but it can result in massive government debt, as it is now in Japan. Repeating Japan scenario is unlikely. The magnitude of balance sheet recession in Japan was much larger. The measures taken have not been so quick and strong.
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