Document Type
Article
Publication Date
2011
Keywords
systemic risk, bank failures, financial crises, bank regulation
Subject Category
Banking and Finance | Law
Abstract
Although a chain of bank failures remains an important symbol of systemic risk, the ongoing trend towards disintermediation—or enabling companies to directly access the ultimate source of funds, the capital (i.e., financial) markets, without going through banks or other financial intermediaries—is making these failures less critical than in the past. While banks and other financial institutions remain important sources of capital, companies today are able to obtain most of their financing through financial markets without the use of intermediaries. As a result, financial markets themselves are increasingly central to any examination of systemic risk.
Recommended Citation
Steven L. Schwarcz, Identifying and Managing Systemic Risk: An Assessment of Our Progress, 1 Harvard Business Law Review 94-104 (2011).
Available at: http://scholarship.law.duke.edu/faculty_scholarship/2407
Comments
This article is based on a keynote address at the March 2011 George Mason University AGEP Advanced Policy Institute on Financial Services Regulation.