The Dutch institutional configuration is unique in its hybrid character. The specific mixture of a strong welfare state and an Anglo‐American‐oriented economy, which is even more pronounced in the case of Amsterdam, creates a buffering capacity. However, this capacity is expected to be insufficient to absorb the entire impact of the current financial and economic crises. The Amsterdam economy, segments of the housing market and urban development in general will be hard hit by the crises. The state will be reasserting itself, but will soon suffer from a lack of investment capital.