A FRAMEWORK FOR THE TREATMENT OF FINANCIAL CONTAGION EFFECTS IN THE CONTEXT OF THE ACTUAL EUROPEAN TURBULENCES

Abstract

There is still a debate regarding a possible restoring of the confidence in European financial markets because there are still underlying problems from the super-sized finance that actually worsened. Anti crisis strategy efficiency and future costs of real reform make analysts more prudent in forecasts. In addition, a possible reduction risk appetite and the loss of confidence will fuel a negative perspective regarding the recovery of emerging economies, extreme fragile to regional or global contagion effects. In modern financial crises, the events spiral out of control, panic and contagion come very fast. Greek debt crisis is the most serious extreme financial event in the Eurozone, with severe contagion features. An analysis of Eurocontagion effects in the context of Greece crisis by using a dynamic version of the Hawkes jump-diffusion model is suggested.

Keywords

• financial crisis
• contagion
• Greek debt crisis (GDC)
• Economic and Monetary Union (EMU)
• Stability and Growth Pact (SGP)