According to Oatley,Bretton Woods II arguably played a key role in the development of the global financial crisis of 2008-2009 because
A) the demand for US government debt instruments drove up interest rates.
B) high interest rates burst the real estate bubbles in US and Europe.
C) the demand for US government debt instruments drove down interest rates.
D) low interest rates drove down the values of commercial real estate in US and Europe.
E) it undermined the Asian savings glut and US economic sovereignty.

Question

Quizplus · Accepted Answer

According to Oatley, Bretton Woods II played a key role in the development of the global financial crisis of 2008-2009 because the demand for US government debt instruments drove down interest rates. This led to a search for higher returns by investors, which resulted in the creation of complex financial instruments that eventually collapsed and caused the crisis.

According to Oatley,Bretton Woods II Arguably Played a Key Role