Federal bank supervision began in the United States with the enactment of the National Bank Act in 1863. From that point until the banking crises of the 1930s, the leaders of the US supervisory agencies—the Comptroller of the Currency (1863) and the Federal Reserve (1913)—recognized that...

This article argues that bank supervision sits at the center of two foundational tensions in the governance of American finance. The first is the extent to which the financial system is controlled by public actors (i.e., the government) or private actors (i.e., the banks). The second is the...

This article explains the roots of financial crises in one of the oldest and most fundamental problems of commercial law: hidden leverage. Common law courts wrestled with this problem for centuries and developed a time - tested solution: the doctrine of secret liens. If the debtor becomes...

This paper describes a new dataset of annual time series relating to the US nonfinancial corporate sector: its market value, and the major underlying stocks and flows that are valued by financial markets. The data cover the entire twentieth century, and thus fill a significant gap in the...

The pari passu clause found in most cross-border lending instruments contains the borrower's promise to ensure that the obligation will always rank equally in right of payment with all of the borrower's other unsubordinated debts. The international financial markets have long understood the...

We examine the returns to investors in publicly traded stock in new industries. We examine data from the United States on sellers of own-brand personal computers, airlines and airplane manufacturers, automobile manufacturers, railroads, and telegraphs. We find that a relatively small number of...

I assemble an annual time series of bid-ask spreads on Dow Jones stocks from 1900-2000, along with an annual estimate of the weighted-average commission rate for trading NYSE stocks since 1925. Spreads are cyclical, especially during periods of market turmoil. The sum of half-spreads and one-way...

This study reports estimates of the marginal benefits and costs of increasing the regulatory minimum bank equity-to-asset “leverage ratio” from 4 to 15 percent. Benefits arise from reducing the probability of a banking crisis. Costs arise from reduced lending, should banks pass off higher...