Open AccessThree Principles for Market-Based Credit Regulation
Author(s) -
Perry Mehrling
Publication year - 2012
Publication title -
american economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 16.936
H-Index - 297
eISSN - 1944-7981
pISSN - 0002-8282
DOI - 10.1257/aer.102.3.107
Subject(s) - economics , key (lock) , financial crisis , core (optical fiber) , financial market , monetary economics , credit crunch , financial system , bond market , financial economics , macroeconomics , finance , computer science , telecommunications , computer security
A key lesson of the financial crisis 2007-09 is that the Bagehot Rule, "lend freely but at a high rate," needs to be updated for the emerging market-based credit system. A modern rule is suggested: Markets, not Banks; Outside spread, not Inside spread; Core, not Periphery.
Accelerating Research
Robert Robinson Avenue,
Oxford Science Park, Oxford
OX4 4GP, United Kingdom
Address
John Eccles HouseRobert Robinson Avenue,
Oxford Science Park, Oxford
OX4 4GP, United Kingdom