Publication
Apr 2009
Banks play a critical role in the allocation of society’s limited savings among the most productive investments, and they facilitate the efficient allocation of the risks of those investments. As the current crisis forcefully reminds us, a breakdown in this process can disrupt economies around the world. Because other financial institutions can step in to fill the gap, failure of an isolated bank is unlikely to cause serious economy-wide problems. Large banks, however, are rarely so isolated.
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English (PDF, 8 pages, 168 KB) |
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Author | Squam Lake Working Group on Financial Regulation |
Series | CFR Working Papers |
Publisher | Council on Foreign Relations (CFR) |
Copyright | © 2009 Council on Foreign Relations (CFR) |