Despite a summer of relatively good news about how well capitalized major banks in the U.S. financial system are, Janet Yellen is concerned about the overall stability of the financial [...]
Credit booms, a rapid increase in the issuance of debt to businesses or consumers, and economic booms, a period of rapid economic expansion, often go hand in hand, as do [...]
1. The Rule of Law in Financial Regulation. 2. FDIC research on moral hazard in double-liability banks. 3. Alan Greenspan supports higher capital requirements. 4. Outsized effects of large bank [...]
Prior to the creation of the Federal Deposit Insurance Corporation, which today guarantees deposits up to $250,000, many banks were subject to “double liability” regulations. In the event of bank [...]
History has not been kind to former Federal Reserve Board Chairman Alan Greenspan (1987-2006). Nicknamed “the maestro,” his policy of loosening monetary policy during stock market downturns, called “the Greenspan [...]
“Big bank, small bank, I like to make money,” said Jared Vennett, Ryan Gosling’s character in the 2015 film The Big Short. Though Vennett’s indifference makes sense for a profit-seeking [...]
The Basel Accords are a series of international banking standards for capital adequacy adopted by various countries around the world. Basel I was first issued in 1988, Basel II followed [...]
Financial reforms passed in the aftermath of the financial crisis were rooted in the logic that the market had failed disastrously, requiring technocrats and regulators to wield greater power to [...]
1. High salaries and high rents on Wall Street. 2. How finance-driven credit booms lead to lower productivity growth. 3. How to account for Fannie and Freddie in the federal [...]
The Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) are the two of the largest government-sponsored enterprises (GSEs) in the U.S., tasked with [...]