How Big Banks Fail and What to Do about It

4.12 ( 24 Ratings by Goodreads)
How Big Banks Fail and What to Do about It

How Big Banks Fail and What to Do about It

(Author)
4.12 (24 Ratings by Goodreads)
hardback
Published: 19 November, 2010
Standard worldwide delivery by Tue, July 21 - Fri, July 24
Order within 0
Condition: NEW
$50.43
RRP $53.52
You save $3.09 (6%)
Price includes shipping
Available 3 in stock
- +
Add to basket Wishlist This
FREE Returns within 30 days
More Details

Popular Books by Darrell Duffie

View All Books by Darrell Duffie
Dynamic Asset Pricing Theory
Dynamic Asset Pricing Theory
Darrell Duffie
$78.49 $93.66
New
Add to basket
Credit Risk
Credit Risk
Darrell Duffie
$156.28
New
Add to basket
The Handbook of China's Financial System
The Handbook of China's Financial System
Darrell Duffie
$108.51 $117.75
New
Add to basket
Security Markets
Security Markets
Darrell Duffie
$193.17
New
Add to basket
Fragmenting Markets
Fragmenting Markets
Darrell Duffie
$50.02 $62.89
New
Add to basket
Mathematical Finance
Mathematical Finance
Darrell Duffie
$161.40 $173.93
New
Add to basket
Mathematical Finance
Mathematical Finance
Darrell Duffie
$190.65
New
Add to basket
Dark Markets
Dark Markets
Darrell Duffie
$59.92 $64.22
New
Add to basket
Structured Credit Products
Structured Credit Products
Darrell Duffie
$97.62 $127.11
New
Add to basket
The Squam Lake Report
The Squam Lake Report
Darrell Duffie
$24.57
New
Add to basket

Description

Dealer banks--that is, large banks that deal in securities and derivatives, such as J. P. Morgan and Goldman Sachs--are of a size and complexity that sharply distinguish them from typical commercial banks. When they fail, as we saw in the global financial crisis, they pose significant risks to our financial system and the world economy. How Big Banks Fail and What to Do about It examines how these banks collapse and how we can prevent the need to bail them out. In sharp, clinical detail, Darrell Duffie walks readers step-by-step through the mechanics of large-bank failures. He identifies where the cracks first appear when a dealer bank is weakened by severe trading losses, and demonstrates how the bank's relationships with its customers and business partners abruptly change when its solvency is threatened. As others seek to reduce their exposure to the dealer bank, the bank is forced to signal its strength by using up its slim stock of remaining liquid capital. Duffie shows how the key mechanisms in a dealer bank's collapse--such as Lehman Brothers' failure in 2008--derive from special institutional frameworks and regulations that influence the flight of short-term secured creditors, hedge-fund clients, derivatives counterparties, and most devastatingly, the loss of clearing and settlement services. How Big Banks Fail and What to Do about It reveals why today's regulatory and institutional frameworks for mitigating large-bank failures don't address the special risks to our financial system that are posed by dealer banks, and outlines the improvements in regulations and market institutions that are needed to address these systemic risks.
See more

More Details

Type Book
ISBN13 9780691148854
ISBN10 0691148856
Number Of Pages 112
Item Weight 255 g
Publisher / Reseller Princeton University Press
Format hardback
See More +

Media Reviews

"[T]his volume will give readers a deeper understanding of how modern banking works."--Choice "There are precious few manuals on global finance. To be sure, there are enough leaden textbooks and scholarly tomes to crush many a library, but there are few nuts-and-bolts guides. Darrell Duffie has performed a great service by attempting to explain in simple terms why and how major investment banks (what he calls 'dealer banks') collapse... How Big Banks Fail is ... a valuable addition to public literature on the global financial crisis."--Joel Campbell, International Affairs "This is a clear and readable account of the mechanisms and incentives at play."--Saxon Brettell, Business Economist "I highly recommend the book. I believe the text should be standard reading for anybody involved with regulating and supervising financial institutions as it offers valuable insights into the plumbing of financial markets and the mechanisms that can cause bank failures. The discussed mechanisms are thought provoking and can provide researchers and regulators with valuable ideas for future research on the financial system as well as banking regulation."--Jan Wrampelmeyer, Financial Markets and Portfolio Management

Show more

Author's Bio

Darrell Duffie is the Dean Witter Distinguished Professor of Finance at Stanford University's Graduate School of Business. He is the author of "Dynamic Asset Pricing Theory" and the coauthor of "Credit Risk: Pricing, Measurement, and Management" (both Princeton).

Show more