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too big to fail

A collection of 2 posts
Lessons learnt from the GFC and how to heed them
ben bernanke

Lessons learnt from the GFC and how to heed them

Boards’ inability to effectively self-regulate firms Prior to the GFC, poor regulation by boards left financial institutions vulnerable to economic downturns. Short-term profits and market share were the primary concern of banks, with Chuck Prince, former CEO of Citibank, declaring “while the music is playing, you have to dance”. [1]
May 20, 2017 4 min read
Risky business: the free insurance provided to banks
Basel

Risky business: the free insurance provided to banks

Moral hazard (n): Where the actions of one party change to the detriment of the other party after a transaction has taken place. Imagine what life would be like if every time you got in trouble, whether it be for speeding, theft or even indecent exposure, your parents bailed you
May 20, 2017 6 min read
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