Angus Armstrong, Philip Davis, 22 April 2016

Since the Global Crisis, a number of regulatory policies have been discussed, proposed and sometimes implemented to address shortcomings in the regulatory framework. This column presents the views of the speakers at a recent conference on whether we have reached an efficient outcome. For most of the speakers, the answer was a resounding “no”.

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Market failures in bank and market liquidity – things such as fire sales and rollover risk – were key elements in the Global Crisis. In this video, Giovanni di Nicolò suggests such dangers could be reduced if banks had a ratio of liquid assets to liquid liabilities close to 1 – they certainly should be higher than they are now. While there is a wide consensus on the need to avoid another such liquidity crisis, there is no agreement on which tools would be best to achieve this. This video was recorded at the 18th March 2016 conference on Financial Regulation organized by NIESR and held at the Bank of England.

Dirk Schoenmaker, 22 April 2016

Governments around the world have embraced macroprudential policies but there is still no consensus on which indicators it should focus on. In this video, Dirk Schoenmaker suggests using credit growth and housing prices as key indicators to follow for macro-prudential policy. Given that macro-prudential policies are highly unpopular, they can’t be in the hands of politicians but should be in the hands of an independent body such as the central bank. This video was recorded at the 18th March 2016 conference on Financial Regulation organized by NIESR and held at the Bank of England. 

Franklin Allen, 22 April 2016

Designing good regulation requires a good knowledge of the systems to be regulated. In this video, Franklin Allen argues that we still have an imperfect understanding of systemic risk leading to difficulties in designing effective regulations. One of the problems stems from the fact that regulators still think in terms of macroeconomics instead of focusing on the financial side. This video was recorded at the 18th March 2016 conference on Financial Regulation organized by NIESR and held at the Bank of England. 

, 22 April 2016

The possibility that banks are “too big to fail” is one that has plagued the financial system for decades. In this video, James Barth suggests that too-big-to-fail has not been challenged enough by regulators and that no bank should be too big to fail in any country. Banks have to be held accountable therefore bank owners should be required to put in more capital. Higher capital requirements would protect tax-payers and the government from bailouts. This video was recorded at the 18th March 2016 conference on Financial Regulation organized by NIESR and held at the Bank of England.

Angus Armstrong, 09 March 2016

The upcoming vote on the UK’s membership of the EU has sparked a vibrant debate on topics ranging from sovereignty and sterling to migrants and the military. This column discusses evidence on the economics of Britain’s EU membership drawn from a recent conference where both sides of the debate were represented. 

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