“Irrational exuberance” can drive asset prices to unrealistic levels, even as the prices of currently traded goods and services exhibit few signs of inflation. The reason is not far to seek. In a fiat money standard, the supply of credit is endogenous, governed by the reaction function of the authorities.
Financial sector development in Africa The financial system in Sub-Saharan Africa is generally bank based and somewhat less sophisticated than our developed country counterparts, with countries on different levels of development. However, there has been remarkable progress over the past two decades.