Commentary: Macroprudential market supervision may be doomed to fail

02/5/2013 | Risk.net (subscription required)

So-called macroprudential supervision -- including measures such as bank capital, liquidity and leverage standards, collateral requirements and loan-to-value limits -- may be insufficient to prevent market meltdowns, many argue. The problem is the complexity of markets and their tendency to treat such measures as merely new price information. Nonetheless, most believe such measures are worth trying.

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