Marc Flandreau, Norbert Gaillard, 26 June 2009

How did the rating agencies come to have such a prominent role in the regulation of securities? This column traces their history back to the Great Depression. Ironically, the agencies became a regulatory instrument to address concerns about securities originators’ conflicts of interest, the very problem plaguing the agencies today. The lesson may be that no fixed regulatory solution is durable in the long run.

Avinash Persaud, 24 June 2009

Policymakers embraced the rhetoric of macro-prudential regulation in response to the crisis, but most of their proposals have just suggested more micro-prudential regulations of the sort that already failed. This column criticizes those proposals and outlines what real macro-prudential approaches would look like.

Con Keating, 02 June 2009

The desire to regulate to avoid repeating this financial crisis is commendable, but this column says that the haste with which new regulations are being promulgated is unnecessary and dangerous. Precursory analysis that is incomplete, incorrect, or inadequate creates substantial potential for unintended consequences. We should take the time to appropriately analyse, design, and implement new regulation.

Claudio Borio, 14 April 2009

There is now a growing consensus among policymakers and academics that a key element to improve safeguards against financial instability is to strengthen the “macroprudential” orientation of regulatory and supervisory frameworks. This column explains the approach and various issues that regulators must address to implement it.

Jean-Charles Rochet, Pierre-François Weber, 02 April 2009

The world will see new financial regulations. This column argues that a macro-prudential framework must be part of the regulatory reform. Macro-prudential policy should rely both on automatic regulatory requirements and a more flexible, yet still rules-based framework, possibly similar to the two-pillar monetary framework of the Eurosystem.

Carmine Di Noia, Stefano Micossi, 01 April 2009

What are feasible policy responses to the crisis? This column argues for simple but significant changes in international imbalances, financial regulation, global coordination, and micro-prudential regulation.
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Michael Dooley, Peter Garber, 21 March 2009

This column argues that current account imbalances, easy US monetary policy, and financial innovation are not the causes to blame for the global crisis. It says that attacking Bretton Woods II as a major cause of the crisis is an attack on the world trading system and a sure way to metastasise the crisis in the global financial system into a crisis of the global economic system.

Xavier Freixas, Joel Shapiro, 18 March 2009

Credit rating agencies played a significant part in the financial meltdown, failing (sometimes intentionally) to properly estimate complicated products’ risk. This column summarises the problems plaguing the industry – conflicts of interest, “shopping” for ratings, and informational issues. It concludes that regulators must reshape the agencies and their role.

Willem Buiter, 09 March 2009

Financial regulation is a now-or-never proposition as the sector’s lobbying power is greatly diminished. This column argues that we should embrace robust regulation now, risking over-regulation. Correcting mistakes later would be better than risking another era of “self-” or “soft-touch” regulation.

Andrea Prat, 09 March 2009

Financial regulation was flawed. However, there are signs that regulators could have done much more with the rules and information they had. Even the best rules are useless if regulators are not interested in enforcing them. This column says regulatory bodies should open their books and make their industry connections transparent so we can evaluate and reduce the risk of regulatory capture.

Morris Goldstein, 24 February 2009

This column sketches proposed reforms for regulation, supervision, and oversight of international financial markets. At both the national and international levels, there will be plenty of work to do for the IMF, the FSF, international standard-setting bodies, and national regulators and supervisors.

Charles Calomiris, 12 February 2009

The financial crisis happened because the rules of the game – shaped by government policy – promote the wilful undertaking of excessive, value-destroying risks by managers who were not effectively disciplined by shareholders. This column outlines the six key areas where regulatory reform is essential to preventing a repeat.

Enrico Perotti, Javier Suarez, 11 February 2009

Most financial system reform proposals rely on better managed, anti-cyclical capital requirements, or some sort of insurance. This column argues that mandatory liquidity insurance would be more effective. The insurance premiums – linked to maturity mismatch and term structure – would essentially be pre-payment for the cost of future financial crises and held in an Emergency Liquidity Insurance Fund.

Viral Acharya, Matthew Richardson, 07 February 2009

How did global finance become so fragile that a collection of bad mortgages in the US could bring the entire system to its knees and the global economy along with it? How can this fragility be eliminated? This column describes the answers provided in an important new book which has been written by a team of world-class scholars from NYU’s business school.

Donato Masciandaro, Marc Quintyn, 03 February 2009

Over the last ten years the financial supervision architecture and the role of the central bank in supervision therein has undergone radical transformation. A new CEPR Policy Insight addresses three questions. Which are the main features of the supervisory architecture reshaping? What explains the increasing diversity of the institutional settings? What are so far the effects of the changing face of banking and financial supervisory regimes on the quality of regulation and supervision?

Donato Masciandaro, Marc Quintyn, 03 February 2009

Central banks that have historically been involved in financial supervision often resist reforms that would unify supervisory powers in an agency other than the bank. This column argues that regulatory innovation is necessary to keep pace with financial innovation. Policymakers should be open to changes, including unification, and adopt reforms needed in their circumstances.

Hyun Song Shin, 31 January 2009

Today’s financial regulation is founded on the assumption that making each bank safe makes the system safe. This fallacy of composition goes a long way towards explaining how global finance became so fragile without sounding regulatory alarm bells. This column argues that mitigating the costs of financial crises necessitates taking a macroprudential perspective to complement the existing microprudential rules.

Luigi Spaventa, 28 January 2009

To fix the world financial system, the G20 needs to look at some bold institutional reforms. The column suggests an international financial stability charter backed up by an new institution that could either be ‘light’ with a slim secretariat, or more elaborate WTO-style organisation.

Luigi Zingales, 28 January 2009

In 1933, US securities regulations were introduced to restore trust in financial markets. Today, a new regulatory focus is needed to address the crisis of confidence. After reviewing the status of financial regulation, this column sketches policy proposals in three key areas of securities markets.

Charles Wyplosz, 27 January 2009

This column introduces the latest ICMB-CEPR Geneva Report – written this year by Markus Brunnermeier, Andrew Crockett, Charles Goodhart, Avinash Persaud, and Hyun Shin. The report discusses how world leaders should think about financial regulation reform, making a number of specific proposals.

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