failure family

systemic risk transmission

20 claims across 10 works.

• imported risk exposure: A country whose bankers do not embrace intentional risk taking is still exposed to risk, both through the collateral effects of intentional risk takin
• counterparty risk blind spot: Because U.S. companies historically financed themselves through markets rather than through each other, U.S. managers are less attuned to risks accumu
• write-down-concentration-effect: Although the EU debt write-down proposal gives regulators certainty and discretion, it could produce greater market uncertainty, raise costs, and have
• Bail-in raises and destabilizes bank funding: Implementing the European Commission's debt write-down proposal has the potential to increase funding costs for financial institutions and to make the
• Cross-holding of contingent capital among competitors: Building critical mass in the contingent capital securities market could require banks and other financial institutions to buy their competitors' cont
• correlated-risk-profiles: Because governments prioritize the rescue of systemically important financial institutions over other entities, those institutions are incentivized to
• standalone-contingent-capital-insufficiency: Contingent capital by itself, without additional measures and supplemental corporate governance improvements, may not prevent firm failure; its real p
• ccs-cross-holdings: A mandatory contingent capital issuance regime induces institutions to buy their competitors' securities to satisfy regulatory obligations rather than
• central-bank-ccs-purchases: If central banks were to purchase contingent capital securities issued by systemically important institutions in the primary or secondary market as pa
• correlated-risk-from-central-bank-purchases: Combining the existing prioritization of bailouts for systemically important institutions with central bank purchases of their contingent capital in a
• consolidation induced systemic risk: A surplus of larger private fund advisers holding correspondingly larger amounts of assets under management could increase systemic risk, so a regulat
• gradual collapse defeats contagion channel: The contagion story, in which hedge fund losses spread to other financial institutions and undermine systemic stability, is counterbalanced in practic
• fire-sale externality: When hedge funds simultaneously liquidate positions and reduce leverage, leverage generates a fire-sale externality that raises systemic risk, arising
• diversification breakdown under stress: Strategy diversification does not insulate the hedge fund industry from systemic risk: returns across different hedge fund strategies were more correl
• Full collateral value lending collapses capital under margin calls: Because banks and brokers had let LTCM borrow the full value of its collateral, LTCM's 4.8 billion dollars in capital dissipated quickly once banks be
• Counterparty overexposure to private funds: Banks overexposed themselves to private investment fund lending, which allowed LTCM and similar funds to grow significantly and led banks as counterpa
• Underwriter insolvency passes through to consumers: In the traditional insurance structure, financial distress or bankruptcy of an individual underwriter harms consumers, who lose the protection of thei
• illusory diversification: LTCM was diversified across markets but not across strategy, so its positions failed together; market level diversification does not imply strategy le
• lax creditor underwriting: LTCM reached systemically dangerous size because banks lent to it without regard to repayment capacity, and in doing so the banks endangered their own
• exchange breach triggers instantaneous withdrawal cascade: Cyber security incidents contribute to the volatility of the digital asset market through a specific channel: consumers instantaneously withdraw their