2. 1

3. 1 Subprime crises in the USA and in GB 2 Confindential crises 3 Financial and liquidity crises 4 Crises in the economies 5 Business and social crises 6 Now: To rethink the basic theories and economic laws 2

4. 3

5. 3 Liquidity bubble

6. Five of the highest paid and most powerful hedge fund managers, from left, George Soros, James Simons, John Paulson, Philip Falcone and Kenneth Griffin, blamed the current financial crisis on the ‘system itself’ when they testified before a US congressional committee hearing on hedge fund regulation 13-11-08 5

7. 6 Would you be willing to bet on roulette or a game of cards if you did not fully understand the workings of the game? Investors who lack a firm sense of valuation face just such a set of circumstances. What do the numbers on a roulette wheel add up to?

8.  “The reality is that this is becoming the most serious global recession for, I’m sure, over 100 years, as it will turn out.”  He warned that events worldwide were moving at a “speed, pace and ferocity which none of us have seen before” and banks were losing cash on a “scale that nobody believed possible”.  “The economy is going to define our politics in this region and in Britain in the next year, the next five years, the next 10, and even the next 15 years,” said Balls. “These are seismic events that are going to change the political landscape. 7

9.  “the largest financial shock since the Great Depression.” IMF.  The UK Financial Services Authority also gave a warning, but milder, that the recession “may be deeper and more prolonged than expected”, and added that the global financial system had “suffered its greatest crisis in more than 70 years”. 8

10.  “We are facing hardships that come once in 100 years.” Takanobu Ito, new head of Honda. 24-2-09  “The classic economic models and theories cannot be applied, and future development cannot be foreseen.” Jean-Claude Trichet, ECB President. 23-2-09 9

11.  “There is no doubt that we are living through the greatest financial and economic crisis in living memory.” Jose Manuel Barroso: President of the European Comission. 10

12.  Paul Volcker, at the same conference, echoed Mr. Soros' sentiments, "I don't remember any time, maybe even in the Great Depression, when things went down quite so fast, quite so uniformly around the world." 11

13.  “For the first time in the post-world war two history we have a generation that seriously doubts whether the next generation is going to live better than themselves.  FT 12-3-09 12

14.  Crisis inevitable: Open and small country  Subprime crisis in the States in 2007 Response: o  No estate baloon  No toxic instruments Result: ? 13

15.  Indebtness of the Hungarian citizens?  Under EU average  In foreign currency  Dates of the crises:  1980’s  2002  2008 14

16.  Two sides of change of Ft exchange rate: Weakening Ft 1. Exporters? 2. Foreign currency borrowers ? 15

17.  The end?