Faculty News
Professors Richard Berner and Kim Schoenholtz offer thoughts on banking, capital markets and the Fed’s response to COVID-19
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Excerpt from The Economist -- "As banks have grown risk-averse, non-banks, often tech-savvy, are stepping up. 'When you regulate the banks and you leave the rest of the financial system more lightly regulated, there will be regulatory arbitrage,' says Richard Berner of New York University. 'But technology has also facilitated a shift because, particularly in the past decade, it has promoted the growth of payments and of bank-like activities outside the banking system.'
The Fed was able to soothe investors through the power of its announcements; it has so far lent only $100bn through its schemes. But Stephen Cecchetti and Kermit Schoenholtz, two scholars, have calculated the scale of each of the implicit guarantees."
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The Fed was able to soothe investors through the power of its announcements; it has so far lent only $100bn through its schemes. But Stephen Cecchetti and Kermit Schoenholtz, two scholars, have calculated the scale of each of the implicit guarantees."
Read More