Before the onset of the financial crisis, foreign currency loans to the non-banking sector in Europe became remarkably prevalent.
Foreign-currency loans and systemic risk in Europe
Pınar Yeşin, 26 November 2013
Foreign-currency returns and systemic risks
Victoria Galsband, Thomas Nitschka, 10 March 2013
Patterns in foreign-currency returns
Macroprudential policy: Economic rationale and optimal tools
Giovanni Favara, Lev Ratnovski, 6 August 2012
The purpose of macroprudential policy is to reduce ‘systemic risk’. While hard to define formally, systemic risk is understood as 'the risk of developments that threaten the stability of the financial system as a whole and consequently the broader economy” (Bernanke, 2009). The notion is meant to include the types of financial imbalances that led to the 2007-2008 bust.
Macroprudential policy: What instruments and how to use them? Lessons from country experiences
Francesco Columba, Alejo Costa, Cheng Hoon Lim, 16 March 2012
Macroprudential policy is quickly gaining traction in international circles as a useful tool to address system-wide risks in the financial sector (see for example Borio 2011, Galati and Moessner 2011, Viñals 2010, 2011). Yet the analytical and operational underpinnings of a macroprudential framework are not fully understood and the effectiveness of the instruments is uncertain.
Capital shortfall: A new approach to ranking and regulating systemic risks
Viral Acharya, Robert Engle, Matthew Richardson, 14 March 2012
The most severe impacts of the financial crisis of 2007–09 arose immediately after the failure of Lehman Brothers on 15 September 2008.
Destabilising market forces and the structure of banks going forward
Arnoud Boot, 25 October 2011
The financial services sector has gone through unprecedented turmoil in the last few years. We see fundamental forces that have affected the stability of financial institutions. In particular, information technology has led to an enormous proliferation of financial markets, but also opened up the banks’ balance sheets by enhancing the marketability of their assets.
Too much finance?
Jean-Louis Arcand, Enrico Berkes, Ugo Panizza, 7 April 2011
The idea that a well-working financial system plays an essential role in promoting economic development dates back to Bagehot (1873) and Schumpeter (1911). Empirical evidence on the relationship between finance and growth is more recent.
Safety-net benefits conferred on difficult-to-fail-and-unwind banks in the US and EU before and during the great recession: A summary
Santiago Carbó-Valverde, Edward J Kane, Francisco Rodríguez Fernández, 22 March 2011
Accounting standards for recognising losses make it hard to detect if a bank is going under. The signs of a bank’s insolvency are slow to surface. During the housing and securitisation bubbles that preceded the 2007-2008 financial meltdown, top managers and regulators of US and EU financial institutions claimed that there was no way they could see the build-up of crisis pressures.
Do we need big banks?
Harry Huizinga, Asli Demirgüç-Kunt, 18 March 2011
In recent years, many banks have reached enormous size both in absolute terms and relative to their national economies. By 2008:
The simple analytics of systemic liquidity risk regulation
Enrico Perotti, Javier Suarez, 16 March 2011
The recent crisis has provided a clear rationale for the regulation of refinancing risk – an aspect that was overlooked in the pre-Crisis agreement on international banking coordination known as “Basel II" (see Acharya and Merrouche 2009).
- A tale of two depressions: What do the new data tell us? February 2010 updateEichengreen, O’Rourke
- The ECB’s stealth bailoutSinn
- Educated in America: College graduates and high school dropoutsHeckman, LaFontaine
- Eurozone breakup would trigger the mother of all financial crisesEichengreen
- Panic-driven austerity in the Eurozone and its implicationsDe Grauwe, Ji
Adelman, 28 October 2013
Reichlin, Giugliano, 7 November 2013
Holmes, McGrattan, Prescott
Beck, De Haas, Ongena
CEPR Policy Research
- The buyer margins of firms' exportsCarballo, Ottaviano, Volpe
- Commodity and Equity Markets: Some Stylized Facts from a Copula ApproachDelatte, Lopez
- Ethnic Unemployment Rates and Frictional MarketsGobillon, Rupert, Wasmer
- Finance and Poverty: Evidence from IndiaAyyagari, Beck, Hoseini
- The Manipulation of Basel Risk-WeightsMariathasan, Merrouche