Policy makers who seek to ensure a robust and effective regulatory regime for banks must always keep in mind the interconnected nature of the industry as well as the various distinct risks that banks
Policy makers who seek to ensure a robust and effective regulatory regime for banks must always keep in mind the interconnected nature of the industry as well as the various distinct risks that banks themselves specialize in managing. This Mercatus on Policy lays out the underlying complexity of the U.S. banking system, defines systemic risk and other risks, and suggests some principles that need to be considered when thinking about major reforms of the banking regulatory regime.