August 25, 2015
Credit and credit aggregates, Financial institutions, Financial markets, Financial services, Financial stability, Financial system regulation and policies, International financial markets, Lender of last resort, Monetary policy implementation, Payment clearing and settlement systems
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Cheap But Flighty: How Global Imbalances Create Financial Fragility
We analyze how a wealth shift to emerging countries may lead to instability in developed countries. Investors exposed to expropriation risk are willing to pay a safety premium to invest in countries with good property rights. -
Quantifying Contagion Risk in Funding Markets: A Model-Based Stress-Testing Approach
We propose a tractable, model-based stress-testing framework where the solvency risks, funding liquidity risks and market risks of banks are intertwined.