2011 Financial Markets Conference: Navigating the New Financial Landscape - April 4-6, 2011

Papers, Presentations, and Interviews

Monday, April 4, 2011

Keynote
Clearinghouses, Financial Stability, and Financial Reform off-site
Ben Bernanke, Chairman, Board of Governors of the Federal Reserve System

YouTube Introduction
YouTubeHistory of Clearinghouses
YouTubeFuture Structures

Tuesday, April 5, 2011

Welcome
Dave Altig, Senior Vice President and Director of Research, Federal Reserve Bank of Atlanta

Research Paper I—"Caught Between Scylla and Charybdis? Regulating Bank Leverage When There Is Rent-Seeking and Risk-Shifting" pdf

Presenter
Viral Acharya, Professor of Finance, New York University

Moderator
Larry Wall, Financial Economist and Senior Policy Adviser, Federal Reserve Bank of Atlanta

Discussant
Anat Admati, Professor of Finance and Economics, Stanford University [Presentation] pdf [Related paper] pdfoff-site

Research Paper II—"Credit Booms Gone Bust: Monetary Policy, Leverage Cycles, and Financial Crises, 1870–2008" off-site

Presenter
Moritz Schularick, Professor of Economics, Freie Universität Berlin [Presentation] pdf

Moderator
Gerald Dwyer, Director of the Center for Financial Innovation and Stability, Federal Reserve Bank of Atlanta

Discussant
Giovanni Dell'Ariccia, Adviser, International Monetary Fund [Presentation] pdf

Welcome and opening remarks
Dennis Lockhart, President and CEO, Federal Reserve Bank of Atlanta

Macro Paper—"Weathering the Financial Crisis: Good Policy or Good Luck?" pdf
This session examines the macroeconomic experience of a range of countries to identify why some weathered the 2007–2009 global financial crisis better than others. One measure of success is defined as a country's output performance relative to a common global trend. This analysis focuses on the policy frameworks, institutions, and decisions of the countries that performed best to understand whether their success was due to good policy or good luck.

Presenter
Stephen Cecchetti, Economic Adviser and Head of MED, Bank for International Settlements [Presentation] pdf
YouTube Interview with Stephen Cecchetti

Moderator
Charles Plosser, President, Federal Reserve Bank of Philadelphia

Discussants
Larry Hatheway, Managing Director, Chief Economist, and Chief Strategist, UBS Investment Bank
Richard Berner, Former Managing Director, Co-Head of Global Economics, and Chief U.S. Economist, Morgan Stanley [Comments] pdf

Macro Panel—"Sovereign Debt: A Cause for Concern"
The financial crisis has been followed by sovereign debt problems if not a sovereign debt crisis. The fiscal problems include hangover from the financial crisis, the recession, and stimulus packages as well as long-term unsustainable spending and tax policies. All these problems have been reflected in one or more countries involved in the recent and possibly continuing sovereign debt problems. Panelists discuss issues such as the causes of the sovereign debt problems as well as likely or desirable short- and long-term resolutions. How will the euro area deal with the problems manifested already? Are other problems likely to surface? Is this crisis a wave that will wash ashore in the United States? Even if not, how will some states' severe budget problems be resolved?

Panelists
Vincent Reinhart
(chair), Resident Scholar, American Enterprise Institute [Presentation] pdf
YouTubeInterview with Vincent Reinhart
Bob Eisenbeis, Managing Director and Chief Monetary Economist, Cumberland Advisors [Presentation] pdf
Peter Hooper, Managing Director and Chief Economist, Deutsche Bank Securities [Presentation] pdf
Angel Ubide, Director of Global Economics, Tudor Investment Corporation [Presentation] pdf

Wednesday, April 6, 2011

Micro Paper—"Banking at the Cross Roads: How to Deal with Marketability and Complexity?" pdf
This session takes a broad view of the fundamental issues related to individual banking organizations. The analysis considers economies of scale (the costs and benefits of very large financial institutions) and economies of scope (the costs and benefits of banks engaging in a wide range of financial services). The paper also examines operational efficiency versus unwinding possibilities associated with various cross-border structures. This analysis then forms the basis for observations on supervisory and regulatory policy.

Presenter
Arnoud Boot, Professor of Corporate Finance and Financial Markets, University of Amsterdam [Presentation] pdf

Moderator
Michael Callen, Chairman of the Board, AMBAC Financial Group Inc. [Presentation] pdf

Discussants
George Kaufman, Professor of Finance and Economics, Loyola University [Presentation] pdf
Peter Wallison, Fellow in Financial Policy Studies, American Enterprise Institute
YouTubeInterview with Peter Wallison

Micro Panel—"Banks' Involvement in Nonbank Financial Activity: Implementing the Volcker Rule"
Commercial bank involvement in nonbank financial activities provides a clear benefit in the form of diversifying risks as well as some potential benefits such as more efficient delivery of financial services and automatically subjecting the activity to prudential supervision. However, this involvement also comes with some costs in that the activity may benefit from the government safety net or may cause the failure of a bank that would otherwise remain solvent.

Panelists
Randall Kroszner
(chair), Professor of Entrepreneurship, University of Chicago
Simon Johnson, Professor of Global Economics and Management, MIT
Anthony Santomero, Board Member, Citigroup
Chester Spatt, Professor of Finance, Carnegie Mellon University
YouTubeInterview with Simon Johnson

Closing remarks
Dennis Lockhart