A Fixed Point Theorem for Measurable-Selection-Valued Correspondences Arising in Game Theory
We establish a new fixed point result for measurable-selection-valued correspondences with nonconvex and possibly disconnected values arising from the...
The Interest rate conditioning assumption
A central bank’s forecast must contain some assumption about the likely future path for its own policy-determined short-term interest rate. Most of...
Iceland, Greece and political hectoring
The Greek and the Icelandic crisis have much in common, not the least the heavy pressure from foreign countries and the hectoring from their public...
The Swiss Black Swan Bad Scenario: Is Switzerland Another Casualty of the Eurozone Crisis
Financial disasters to hedge funds, bank trading departments and individual speculative traders and investors seem to always occur because of non...
A proposed research and policy agenda for systemic risk
The long-running Greek crisis and China’s recent stock market crash are the latest threats to the stability of the global financial system. But as...
Are asset managers systemically important?
Some financial authorities have proposed designating asset managers as systemically important financial institutions (SIFIs). This column argues that...
A Kalecki Fable on Debt and the Monetary Transmission Mechanism
Kalecki explained debt resolution by means of a fable about monetary circulation between mutually indebted individuals. This Note explains the context...
Failed Lehman Rescue efforts:Myths, Facts, and Lessons
Did Lehman really have to fail? This is one of the least-attended but most critical issues of the first decade and a half of this century. My view is...
Structural Banking Reforms: an illusionary solution
It is always dangerous to go against conventional thinking. But I must say that the focus on bank “structural reforms” puzzles me somewhat. So, I will...
Insecure Debt
We analyse bank runs under fundamental and asset liquidity risk, adopting a realistic description of bank default. We obtain an unique run equilibrium...
Taming the Basel Leverage Cycle
Effective risk control must make a tradeoff between the microprudential risk of exogenous shocks to individual institutions and the macroprudential...
Six structures in search of stability
This paper analyses the proposition that adjusting structure can strengthen safety and therefore promote stability. It examines six proposals...
Maturity Mismatch Stretching: Banking Has Taken a Wrong Turn
This note reviews the evolution of maturity transformation in banking and discuss- es the financial stability implications of its current level...
Activist Funds, Leverage, and Procyclicality
We develop a dual-layered agency model to study blockholder monitoring by activist funds that compete for investor flow. Competition for flow affects...
Endogenous Correlated Network Dynamics
We model the structure and strategy of social interactions prevailing at any point in time as a directed network and we address the following open...
If Greece defaults, dominoes will not fall
How would a unilateral Greek default affect politics and policy elsewhere in Europe? A Greek default is more likely to strengthen voter support across...