Financial contagion – the situation in which liquidity or insolvency risk is transmitted from one financial institution to another – is viewed by policymakers and academics as a key source of systemic risk in the banking sector.
Exploring the transmission channels of contagious bank runs
Martin Brown, Stefan Trautmann, Razvan Vlahu, 10 April 2014
Banks’ disclosure and financial stability
Rhiannon Sowerbutts, Ilknur Zer, Peter Zimmerman, 5 April 2014
Investors in banks need information about the risks that they are exposed to in order to be able to assess and price those risks properly. However, during the recent crisis, investors found that they did not have enough information to assess these risks, which led to a dramatic increase in funding costs, intensifying the crisis (Gorton 2008).
The role of central banks in financial stability: How has it changed?
Willem Buiter, 16 January 2012
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Topics: EU institutions, Financial markets, Global crisis, Global economy, Institutions and economics, Macroeconomic policy, Monetary policy, Politics and economics
Tags: accountability, Central Banks, financial stability, global crisis, unorthodox monetary policy
Coordinating bank-failure costs and financial stability
Iman van Lelyveld, Marco Spaltro, 27 October 2011
During the financial crisis, failure or distress of cross-border firms has been met by ad hoc coordinated solutions (eg Fortis and Dexia) or national solutions (eg UK and US banks).
Rethinking central banking
Barry Eichengreen, Eswar Prasad, Raghuram Rajan, 20 September 2011
In the wake of the global financial crisis, there is an emerging consensus that the framework underpinning modern central banking – known as flexible inflation targeting – needs to be rethought.
Monetary policy and excessive bank risk taking
Itai Agur, Maria Demertzis, 13 January 2011
Disclaimer: The views expressed in this article are those of the authors only, and do not reflect the views of De Nederlandsche Bank or of its Board.
The impact of banking sector stability on the real economy
Pierre Monnin, Terhi Jokipii, 7 October 2010
At the November 2008 meeting of the G20, just two months after the collapse of Lehman Brothers, the need for regulatory reform had already been clearly established.
The “other” imbalance and the financial crisis
Ricardo Caballero, 14 January 2010
One of the main economic villains before this crisis was the presence of large “global imbalances”, which refer to the massive and persistent current account deficits experienced by the US and financed by the periphery. The IMF, then in a desperate search for a new mandate that would justify its existence, had singled out these imbalances as a paramount risk for the global economy.
Securitisation and financial stability
Hyun Song Shin, 18 March 2009
Financial booms and busts are as old as finance itself, but the current global financial crisis has the distinction of being the first post-securitisation crisis. Securitisation refers to banks’ practice of parcelling and selling loans to other investors.
Reforms of the world financial system: Can the G20 deliver?
Luigi Spaventa, 28 January 2009
In these hard times, with banks collapsing by the week and the arteries of credit clogged in spite of government interventions of unprecedented size and nature, drafting blueprints of reform of the financial system may seem an unnecessary distraction from more pressing challenges. It is not so.
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