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Could be the International Financial Crisis a Sinonim to a Profound Recession of Romanian Economy? A Theory of “Weak” Statistical Signals

Author(s): Gheorghe Savoiu

Journal: The Romanian Economic Journal
ISSN 1454-4296

Volume: XII;
Issue: 31;
Start page: 99;
Date: 2009;
Original page

Keywords: economic crisis | recession | financial crisis | cyclical phenomenon of “Juglar” type.

This paper consists of a graphical illustration of the Romanian economic cycleduring the period 1990-2007, as a background of contemporary financial crisis.The first part provides an overview of the definition of recession and financialcrisis, and the gains from using both types in financial and economic thinking tounderstand the Romanian contemporary economy. The second part formulates ahypothesis of economic and national GDP cyclical phenomenon of “Juglar” type,with two visible evolution periods, the former of expansion and the latter of recession,and between them, less evident, the crisis and the downward. The Romanianmarket economy crossed two “Juglar” cycles over five electoral periods that succeededalready to outline the elements of electoral cyclical type. Pursuing the evolutionof the indexes studied during 1990-2007, one can establish that the intensityof the economic GDP cyclical phenomenon from the first period (1990-1997)is accompanied by the trends of equilibrium in the second part (1997-2007),trends that can be evaluated as positive ones in the macroeconomic stability pointof view. But, banking crises are preceded by credit booms. The third part of thispaper is devoted to a special analysis of Caprio, Klingebiel, Laeven, and Noguera(2005) banking crisis database. The most important conclusions underlines thata new recession was imminent in Romanian economy in the years 2008 or 2009.The influence of the financial crisis will emphasize the dimension of economic crisis and recession, in general, for Romanian market economy
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