{"id":20740,"date":"2016-05-18T20:32:36","date_gmt":"2016-05-19T01:32:36","guid":{"rendered":"http:\/\/olduvai.ca\/?p=20740"},"modified":"2016-05-18T20:32:36","modified_gmt":"2016-05-19T01:32:36","slug":"fighting-the-next-global-financial-crisis","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=20740","title":{"rendered":"Fighting the Next Global Financial Crisis"},"content":{"rendered":"
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Fighting the Next Global Financial Crisis<\/a><\/h3>\n<\/header>\n
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NEW HAVEN \u2013 What do people mean when they criticize generals for \u201cfighting the last war\u201d? It\u2019s not that generals ever think they will face the same weapon systems and the same battlefields. They certainly know better. The error, to the extent that the generals make it, must operate at a more subtle level. Generals are sometimes\u00a0slow\u00a0<\/i>to get around to developing plans and ordnance for those new weapon systems and battlefields. And just as important, they sometimes assume that the public\u00a0psychology<\/i>, and the\u00a0narratives<\/i>\u00a0that influence the morale that is so important in achieving victory, is the same as in the last war.<\/p>\n

That is also true for regulators whose job is to prevent financial crises. For the same reasons, they may be slow to change in response to new situations. They tend to be slow to adapt to changing public psychology. The need for regulation depends on public perceptions of the last crisis, and, as George Akerlof and I argued in\u00a0Animal Spirits<\/i><\/a>, these perceptions depend heavily on changing popular narratives.<\/p>\n

\"minting<\/a><\/p>\n

Central Banking\u2019s Final Frontier?<\/strong><\/p>\n

Anatole Kaletsky<\/b>\u00a0weighs the views of Raghuram Rajan, Adair Turner, Stephen Roach, and others on how far today\u2019s increasingly exotic monetary policies can and should go.<\/p>\n<\/section>\n

The latest progress reports from the Financial Stability Board (FSB) in Basel outline definite improvements in stability-enhancing financial regulations in 24 of the world\u2019s largest economies. Their \u201cDashboard<\/a>\u201d tabulates progress in 14 different regulatory areas. For example, the FSB gives high marks for all 24 countries in implementing the Basel III risk-based capital requirements.<\/p>\n

But the situation is not altogether reassuring. These risk-based capital requirements may not be high enough, as Anat Admati and Martin Hellwig argued in their influential book\u00a0The Bankers New Clothes<\/a><\/i>. And there has been much less progress in a dozen other regulatory areas that the FSB tabulates.<\/p>\n

…click on the above link to read the rest of the article…<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Fighting the Next Global Financial Crisis NEW HAVEN \u2013 What do people mean when they criticize generals for \u201cfighting the last war\u201d? It\u2019s not that generals ever think they will face the same weapon systems and the same battlefields. They certainly know better. The error, to the extent that the generals make it, must operate […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[124,1570,1941,13881,2240,13898,5821],"class_list":["post-20740","post","type-post","status-publish","format-standard","hentry","category-economics","tag-central-banks","tag-financial-stability-board","tag-fsb","tag-gfc","tag-global-financial-crisis","tag-project-syndiacate","tag-robert-shiller"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/20740","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=20740"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/20740\/revisions"}],"predecessor-version":[{"id":20741,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/20740\/revisions\/20741"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=20740"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=20740"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=20740"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}