FINANCIAL CRISIS -- MACRO AND MICROECONOMIC CONNOTATIONS. MEASURES OF COMING OUT OF CURRENT FINANCIAL CRISIS.

Financial markets have the essential role of channeling funds to those individuals or companies that have productive investment opportunities. If the financial system does not fulfill its role properly, the economy cannot operate efficiently and economic growth is stunted. Financial instability takes place when financial system shock infringes on information flux. Thus, the financial system can no longer achieve its purpose of channeling funds to those that hold investment opportunities. A series of theoretical aspects concerning international financial crises, financial crises on a company level, as well as the role of the Basel II Accord in stimulating risk management throughout financial crises. The paper ends with presentations of aspects concerning prudential regulation at a macroeconomic level -- measures to alleviate the current financial crises. Thus, the greater a company's contribution to the risk in the financial system, the greater the demand for funds, the Pigovian tax, or the compulsory insurance premium. [ABSTRACT FROM AUTHOR]