Clark Center Forum

Douglas W. Diamond and Raghuram G. Rajan FT.com; April 20th, 2009 Why are banks so reluctant to lend? One possibility is that they worry about borrower credit risk, though worries need to be extreme to justify the substantial drop in term lending. A second is that they may worry about having enough liquidity of their […] 

April 24, 2009 The details regarding the procedures employed in the so-called “stress tests” were released today.  The results will be made public next Friday, but we can already tell that there are three serious problems with the SCAP. These shortcomings involve the starting point, the ending point and the paths assumed in the exercise… […] 

Economist.com; April 8, 2009 In a guest article, Raghuram Rajan argues for a regulatory system that is immune to boom and bust AS THE G20 summit showed, we typically regulate in the midst of a bust. That is when righteous politicians feel the need to do something, bankers’ frail balance-sheets and vivid memories make them […] 

The Squam Lake Working Group on Financial Regulation is a nonpartisan, nonaffiliated group of fifteen academics who have come together to offer guidance on the reform of financial regulation. Four Chicago Booth Faculty (John Cochrane, Douglas Diamond, Anil Kashyap and Raghuram Rajan) are members. The group’s latest memos with thoughts on “Reforming Capital Requirements for […] 

Oliver Hart and Luigi Zingales ForeignPolicy.com; March 30, 2009 As Timothy Geithner pushes for an overhaul, it is time to rehabilitate one of the tools that got us into this mess: the credit-default swap. Just days after announcing his plan to clean up banks’ balance sheets of toxic assets, U.S. Treasury Secretary Timothy Geithner hit […] 

New York Daily News, March 25, 2009 On Monday, the market rallied 7% at the announcement of Treasury Secretary’s Timothy Geithner’s plan to deal with banks’ toxic assets. Should taxpayers celebrate as well? The answer is a resounding no. Geithner’s plan is just a more risky and cagey version of the original plan by his […] 

Douglas Diamond and Anil K Kashyap Professors Diamond and Kashyap list their priorities for the next steps in combating the financial crisis. Read more> 

Economist.com; Economist Debates In answer to the question: “Are we all Keynesians again? If not, should we be?” Professors Luigi Zingales and Brad DeLong argue opposing sides of issue in Tuesday, March 10th’s live debate on the Economist.com. Read statements> 

Anil K Kashyap and Frederic Mishkin FT.com Opinion, March 3, 2009 Last week, President Barack Obama asked Congress to move swiftly to create a new financial regulatory system for the US. The system is clearly broken, and fixing it should be a high priority. However, moving swiftly to put in place a new regulatory system […] 

February 25, 2009 Kedran Panageas from JP Morgan Chase gave the Booth finance faculty a very informative presentation on the “Decline and Fall of Securitization Markets”.  At the suggestion of several faculty, we thought the presentation might be of general interest to the readers of the IGM blog. View pdf>