# Financial crisis

`kaal:entity:financial-crisis`

**Status.** derived

This node is assembled mechanically from the 14 claims that carry the concept tag `financial-crisis`. It is a roster of what the corpus says under this term. It is **not** an adjudicated definition: no single statement here has been ruled canonical, and no first-appearance call has been made. Read the claims and judge for yourself.

## Every claim under this term

14 claims across 12 works, 2011 to 2024.

**2011**

- [1806252-021](https://wulfkaal.github.io/claims/1806252-021) [empirical/argued] -- Market failure in complex financial instruments, rather than hedge fund activity as such, could have been a contributing factor in the recent credit crisis.
  > Market failure in complex financial instruments could have been a contributing factor in the recent credit crisis.
  Kaal, Hedge Fund Regulation Via Basel III (2011). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1806252
- [1908473-011](https://wulfkaal.github.io/claims/1908473-011) [failure/argued] *(failure mode)* -- Existing proposals for implementing contingent capital do not explain how they would address the information asymmetries and principal and agent problems that may lie at the core of the credit crisis.
  > Although contingent capital has many beneficial attributes, existing proposals for implementing contingent capital are unclear as to how they will address information asymmetries and principal/agent problems.
  Wulf A. Kaal, Christoph Henkel, Contingent Capital with Sequential Triggers (2011). SSRN: https://ssrn.com/abstract=1908473

**2012**

- [1998455-006](https://wulfkaal.github.io/claims/1998455-006) [empirical/evidenced] -- The anecdotal record of ethically questionable conduct by leaders of systemically important financial institutions is not dispositive and does not establish an underlying trend, but it does show that some of the most pervasive cases of unethical conduct involved such institutions.
  > The anecdotal evidence pertaining to ethically questionable conduct of SIFI leaders is certainly not dispositive or indicative of underlying trends. It does seem to show, however, that some of the most pervasive cases of unethical conduct did involve SI- FIs.
  Wulf A. Kaal, Initial Reflections on the Possible Application of Contingent Capital in Corporate Governance (2012). SSRN: https://ssrn.com/abstract=1998455
- [2061166-004](https://wulfkaal.github.io/claims/2061166-004) [failure/evidenced] *(failure mode)* -- Purely national crisis measures proved ineffective during the financial crisis because they could not reach cross-border banking operations or contain contagion, as the failures of Lehman Brothers, Fortis, the Icelandic banks, Northern Rock and Hypo Real Estate Holding demonstrated.
  > national measures proved ineffective and failed to address cross-border banking operations or contagion.
  Christoph K. Henkel, Wulf A. Kaal, Contingent Capital in European Union Bank Restructuring (2012). SSRN: https://ssrn.com/abstract=2061166

**2013**

- [kaal-2013-acomparativeperspectiveo-013](https://wulfkaal.github.io/claims/kaal-2013-acomparativeperspectiveo-013) [empirical/evidenced] -- German commentators, whose expertise German courts rely on heavily, concluded after the financial crisis that managers do not act reasonably under the German business judgment rule if the risks they take on behalf of the corporation result in the demise of the corporation.
  > German commentators (contrary to their counterparts in the United States, German courts rely heavily on the expertise of commentators) concluded that managers do not act reasonably in terms of the German business judgment rule if risks
  Kaal, A Comparative Perspective on the Limitations of the Duty of Oversight – A Comment on Lisa Fairfax (2013)

**2014**

- [2470008-007](https://wulfkaal.github.io/claims/2470008-007) [empirical/evidenced] -- The 2008 to 2009 financial crisis altered market conditions and the factors driving private fund systemic risk, which triggered a second, distinct wave of scholarship on private funds' systemic implications.
  > The 2008-09 global financial crisis changed market conditions and several related factors that contribute to private funds advisers' posing a possible systemic risk, precipitating the second major wave of scholarship in the context of possible systemic implications of private funds.
  Wulf A. Kaal, The Systemic Risk of Private Funds after the Dodd-Frank Act (2014). SSRN: https://ssrn.com/abstract=2470008
- [2470008-008](https://wulfkaal.github.io/claims/2470008-008) [empirical/evidenced] -- Some estimates place private funds ahead of banks in size and importance during and after the financial crisis.
  > According to some estimates, private funds surpassed banks in size and importance during and after the financial crisis.
  Wulf A. Kaal, The Systemic Risk of Private Funds after the Dodd-Frank Act (2014). SSRN: https://ssrn.com/abstract=2470008

**2016**

- [2811718-004](https://wulfkaal.github.io/claims/2811718-004) [mechanism/argued] -- After the financial crisis of 2008 to 2009 and the Madoff scandal, relatively sophisticated investors stopped accepting the slanted phrasing of due diligence questionnaires and their answers, and the questionnaires became more rigorous as a result.
  > including the Madoff scandal, investors, at least relatively sophisticated investors, no longer accepted the slanted phrasing of the due diligence questionnaires and their answers.13 As a result, the questionnaires became more rigorous.
  Wulf A. Kaal, Private Fund Investor Due Diligence – Evidence from 1995 to 2015 (2016). SSRN: https://ssrn.com/abstract=2811718
- [2811718-015](https://wulfkaal.github.io/claims/2811718-015) [empirical/evidenced] -- Legal decisions involving private fund due diligence increased substantially after 2005 and especially after 2008, and the broad, narrow, and hand selected case categories all increased consistently with a slight lapse in 2014.
  > Figure 3 shows that the legal decisions involving private fund due diligence have substantially increased since 2005, but especially since 2008. Cases involving IDD in the broad, narrow, and selected case categories all consistently increased overall, with a slight lapse in 2014.
  Wulf A. Kaal, Private Fund Investor Due Diligence – Evidence from 1995 to 2015 (2016). SSRN: https://ssrn.com/abstract=2811718
- [2811729-006](https://wulfkaal.github.io/claims/2811729-006) [mechanism/argued] -- The emergence of unconstrained mutual funds is driven by market forces: post-crisis structural and regulatory changes to the capital markets, a low interest rate environment, and the growth of private funds together created and then increased retail demand for alternative mutual funds.
  > Structural and regulatory changes to the capital markets precipitated by the financial crisis of 2007–2008 and a low interest-rate environment, in combination with the enormous growth of private funds, created, and over time increased, the demand17 for retail "alternative" mutual funds.
  Wulf A. Kaal, Unconstrained Mutual Funds and Retail Investor Protection (2016). SSRN: https://ssrn.com/abstract=2811729

**2017**

- [2922176-038](https://wulfkaal.github.io/claims/2922176-038) [empirical/asserted] *(failure mode)* -- The corporate governance frameworks developed in the 2000s had little or no impact on the performance of listed companies during the financial crisis, and the number, scale, and effects of corporate scandals are not diminishing.
  > Contemporary corporate governance frameworks developed in the 2000s had little or no impact on the performance of listed companies during the last financial crisis. Moreover, the number, scale, and effects of corporate scandals and economic failures do not appear to be diminishing.
  Mark Fenwick, Wulf A. Kaal, Erik P. M. Vermeulen, The ‘Unmediated’ and ‘Tech-Driven’ Corporate Governance of Today's Winning Companies (2017). SSRN: https://ssrn.com/abstract=2922176
- [3002908-022](https://wulfkaal.github.io/claims/3002908-022) [mechanism/argued] -- Post crisis regulation that restrained bank lending, particularly to SMEs, opened a new market that private investment funds moved into, accelerating their involvement in banking functions.
  > After the crisis, newly issued regulation restrained banks from lending, in particular to SMEs. This opened up a new market for private investment funds that stepped into the void left by the new regulatory regime.
  Wulf A. Kaal, Marco Dell'Erba, Blockchain Innovation in Private Investment Funds - A Comparative Analysis of the United States and (2017). SSRN: https://ssrn.com/abstract=3002908

**2019**

- [3411897-006](https://wulfkaal.github.io/claims/3411897-006) [mechanism/argued] -- The disillusionment with political institutions after the 2008 to 2009 financial crisis inaugurated a new form of technological decentralization, of which the 2009 Bitcoin protocol is the leading result, conceived as an alternative to the shortcomings of the financial system.
  > crisis of 2008-9 inaugurated a new form of technological decentralization. As one result, among many, the Bitcoin protocol emerged in 2009 as an attempt by its founders to provide an alternative to the shortcomings of the financial system.
  Wulf A. Kaal, Decentralization - Past, Present, and Future (2019). SSRN: https://ssrn.com/abstract=3411897

**2024**

- [4900880-014](https://wulfkaal.github.io/claims/4900880-014) [empirical/evidenced] -- Financial derivatives are a major form of economic entanglement that played a key role in recent financial crises, with nominal values estimated at over a quadrillion dollars, which indicates how extensive entanglement in the global financial system has become.
  > The nominal value of financial derivatives has been estimated at over a quadrillion dollars, highlighting the extent of entanglement in the global financial system.
  Wulf A. Kaal, Quantum Economy and the Future of Work (2024). SSRN: https://ssrn.com/abstract=4900880

## Verify

Every claim above resolves to a record carrying a verbatim source quote, the sha256 of the source PDF, and a preformatted citation. Nothing here asks to be taken on trust.

    curl -s https://wulfkaal.github.io/entities/financial-crisis.md | sha256sum

**Canonical form.** This markdown file is the canonical hashed representation of this entity node. Its sha256 is the content hash.