# kaal:claim:2748096-005

**Claim.** The combination of unprecedented private fund industry growth and the low interest rate environment produced by post-crisis quantitative easing pushed private fund managers into reaching for yield, and the leverage and complex derivative transactions used to boost that yield further increased private funds' systemic risk.

**Type.** mechanism  **Support.** argued

**Holds when.**

- post-2008 low interest rate environment
- quantitative easing by the Federal Reserve

**Source quote.**

> The unprecedented growth in the private fund industry combined with the low interest rate environment following the Federal Reserve's quantitative easing after the financial crisis resulted in private fund managers' increasingly "reaching for yield."

**From.** Wulf A. Kaal, Timothy A. Krause, *Hedge Funds and Systemic Risk* (2016), THE DEBATE ON HEDGE FUNDS' SYSTEMIC RISK, page 3

**Cite as.** Wulf A. Kaal, Timothy A. Krause, Hedge Funds and Systemic Risk (2016). SSRN: https://ssrn.com/abstract=2748096

**Verify.** sha256 of source PDF `8f30260f2c1db728b45c4f3b9b7c64358cf9d3217277bc3c63a910c32f87b508` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20and%20Krause%20-%202016%20-%20Hedge%20Funds%20and%20Systemic%20Risk.pdf

**Topics.** defi, systemic-risk, risk-and-incentives

**Keywords.** reaching-for-yield, leverage, quantitative-easing, systemic-risk, derivatives

**Related claims.**

- extends: https://wulfkaal.github.io/claims/2470008-009

**Canonical form.** This markdown file is the canonical hashed representation of the claim. Its sha256 is the content hash used for attestation.