CFLP blue bag lunch talk with Prof. Jeffery Zhang
Date & Time
LocationThis is a Virtual Event.
Conventional wisdom says the 2008 financial crisis fundamentally changed how policymakers approach financial regulation, with regulators seeking to prevent individual financial institutions from collapsing using a “microprudential” strategy before the crisis, and turning to a new “macroprudential” approach that prioritizes the stability of the financial system as a whole post-crisis. Despite new stress tests, capital buffers, liquidity requirements, and other supposed macroprudential tools, Prof. Zhang will present his research, co-authored with Jeremy Kress, which argues that using the term “macroprudential” to describe modern financial regulation is a myth. Despite the macroprudential label, the prevailing regulatory framework is still predominantly microprudential in nature. This inaccurate portrayal has consequences, and risks a repeat of the 2008 collapse. How to re-orient? Prof. Zhang has some ideas.