New research from Arvind Krishnamurthy argues that the rapid adoption of financial innovations—in this case, subprime mortgage-backed securities—set the stage for crisis. His report with coauthor Ricardo J. Caballero found that when popular new financial instruments behave unexpectedly, investors flee the market. The liquidity supply tightens, making it hard for market participants to get the capital they need.
Content: Article
Authors: Arvind Krishnamurthy, Ricardo J. Caballero
Source: Kellogg Insight
Subjects: Economics, Finance
Authors: Arvind Krishnamurthy, Ricardo J. Caballero
Source: Kellogg Insight
Subjects: Economics, Finance
Like this content? Why not share it?
There Are No Comments
Click to Add the First »
Click to Add the First »