On October 24, 2003, SUERF celebrated its 40th anniversary in the Galerie Dorée of the Banque de France with an especially high level and rich seminar. The memorable occasion was further elevated by Jean Claude Trichet giving the tenth SUERF Annual Lecture in his last public speech as Governor...

This essay was published as part of a law review symposium that evaluated my work on theregulation of large, complex financial institutions. Part I of my essay discusses the other articlespublished in the symposium issue and describes their relationship to my own work. Part IIanalyzes the global...

While the Dodd Frank Act (DFA) broadens the regulatory reach to reduce systemic risks to the U.S. financial system, it does not address some important risks that could migrate to or emanate from entities outside the federal safety net. At the same time, it limits the types of interventions by...

Central banks may engage in large-scale lending and asset purchases to stabilize financial markets and implement monetary policy during crises. The ability of these actions to restore financial market functioning is well documented; however, they come with costs. We provide a literature review of...

A "sunspot" is a variable that has no direct impact on the economy's fundamental condition, such as preferences, endowments or technologies, but may nonetheless affect economic outcomes through the expectations channel as a coordination device. This paper investigates how people react to...

Market distress can be the catalyst of a deleveraging wave, as in the 2007/08 financial crisis. This paper demonstrates how market distress and deleveraging can fuel each other in the presence of adverse selection problems in asset markets. At the core of the detrimental feedback loop is agents'...

We build a general equilibrium model with financial frictions that impede the effectiveness of monetary policy in stimulating output. Agents with heterogeneous productivity can increase investment by levering up, but this increases interim liquidity risk. In equilibrium, the more productive...

Financial intermediaries issue the majority of liquid securities, and nonfinancial firms have become net savers, holding intermediaries' debt as cash. This paper shows that intermediaries' liquidity creation stimulates growth -- firms hold their debt for unhedgeable investment needs -- but also...

We use daily transactional ledger data from the Bank of England's Archive to test whether and to what extent the Bank of England during the mid-nineteenth century adhered to Walter Bagehot's rule that a central bank in a financial crisis should lend cash freely at a high interest rate in...

This study reviews the evolution of financial markets, institutions, and policy frameworks in the economy of the Republic of Korea over the two decades since the 1997 Asian financial crisis and assesses their effectiveness in reducing the likelihood and adverse effects of future financial...