In contrast to existing research, I find that tougher capital requirements were probably not responsible for the increase in capital ratios throughout the 1980s. Banks with low capital ratios tended to mean-revert well before any change in policy, and did not raise their capital ratios any...

Liquidity hoarding by banks and extreme volatility of the fed funds rate have been widely seen as severely disrupting the interbank market and the broader financial system during the 2007-08 financial crisis. Using a dataset of intraday Federal Reserve bank account balances and Fedwire interbank...

In the second half of 2008, the issuance of auto, credit card, and student loan asset-backed securities (ABS) all but stopped while secondary market spreads on AAA-rated tranches of consumer ABS reached historical levels. If sustained, the break-down of the originate-to-distribute model for...

While bank capital requirements permit a bank to freely substitute between equity and subordinated debt, lenders and investors view debt and equity as imperfect substitutes. It follows that, after controlling for the level of regulatory capital, the mix of debt in capital isolates the role that...

Shadow banks conduct credit intermediation without direct, explicit access to public sources of liquidity and credit guarantees. Shadow banks contributed to the credit boom in the early 2000s and collapsed during the financial crisis of 2007-09. We review the rapidly growing literature on shadow...

We employ a unique data set of public commercial real estate (CRE) bonds issued during the Great Depression era (1920-32) to determine their frequency of default and total loss given default. Default rates on these bonds far exceeded those originated in subsequent periods, driven in part by the...