# kaal:claim:2097160-016

**Claim.** Market-based trigger measures are vulnerable to market manipulation and bank runs, while accounting-based measures are updated too infrequently to respond adequately in a financial crisis.

**Type.** failure  **Support.** argued

**Holds when.**

- institution-specific automatic triggers keyed to market or accounting metrics

**Source quote.**

> However, market-based measures may be susceptible to market manipulation and banking runs.156 Accounting-based measures in institution- specific automatic triggers are arguably too infrequently updated to respond adequately in a financial crisis.

**From.** Wulf A. Kaal, *Contingent Capital in Executive Compensation* (2012), V.B.1 Automatic Institution-Specific Early Trigger, page 37

**Cite as.** Wulf A. Kaal, Contingent Capital in Executive Compensation (2012). SSRN: https://ssrn.com/abstract=2097160

**Verify.** sha256 of source PDF `1e1f8aa246bce19f4658dbceb455c7c2a272aa5d63a9e9bdaa46a3a5a87680fc` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202012%20-%20Contingent%20Capital%20in%20Executive%20Compensation.pdf

**Failure mode.** Trigger metric manipulation and staleness  (family: trigger-design-failure)

**Topics.** contingent-capital, economics, systemic-risk

**Keywords.** trigger-design, market-manipulation, accounting-measures, bank-runs

**Related claims.**

- restated_by: https://wulfkaal.github.io/claims/2273857-060
- contests: https://wulfkaal.github.io/claims/1908473-008

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