To send content items to your account,
please confirm that you agree to abide by our usage policies.
If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account.
Find out more about sending content to .
To send content items to your Kindle, first ensure firstname.lastname@example.org
is added to your Approved Personal Document E-mail List under your Personal Document Settings
on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part
of your Kindle email address below.
Find out more about sending to your Kindle.
Note you can select to send to either the @free.kindle.com or @kindle.com variations.
‘@free.kindle.com’ emails are free but can only be sent to your device when it is connected to wi-fi.
‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.
Abstract The most important lesson from the financial crisis of 2007 to 2009 has been that failures of some large financial institutions can impose costs on the entire system. We call these systemically important financial institutions (SIFIs). Their failures invariably put regulators in a compromised situation since, absent prearranged resolution plans, they are forced to rescue the failed institutions to preserve a functioning financial system. In the recent crisis, this has involved protecting not just insured creditors, but sometimes uninsured creditors and even shareholders. The anticipation that these bailouts will occur compromises market discipline in good times, encouraging excessive leverage and risk taking. This reinforces the systemic risk in the system. It is widely accepted that systemic risk needs to be contained by making it possible for these institutions to fail, thus restraining their incentives to take excessive risks in good times. First and foremost, however, regulators need to ascertain which institutions are, in fact, systemically important. Indeed, the systemic risk of an individual institution has not yet been measured or quantified by regulators in an organized manner, even though systemic risk has always been one of the justifications for our elaborate regulatory apparatus.
There are some institutions that follow highly cyclical activities and are thus heavily correlated with aggregate economic conditions. If these institutions are also highly levered, especially with short-term debt, then they face runs in the event of sufficiently adverse news about their condition.
Email your librarian or administrator to recommend adding this to your organisation's collection.