We develop a model in which a financial intermediary's investment in risky assets - risk taking - is excessive due to limited liability and deposit insurance, and characterize the policy tools that implement efficient risk taking. In the calibrated model, coordinating interest rate policy with...

This is an unedited draft of the closing chapter of a forthcoming book, entitled Systemic Risk in the Financial Sector: Ten Years After the Great Crash, that will be published by CIGI Press in fall 2019 (edited by Douglas W. Arner, Emilios Avgouleas, Danny Busch, and Steven L. Schwarcz). The...

A decade after the financial crisis, regulators worry that the regulation enacted to help stabilize the financial system may be insufficient to prevent another crisis. Examining that regulation with the benefit of hindsight, this Article finds that much has been accomplished but much remains to...