Summary: Safe Assets and the Global Savings Glut

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來自 Yale University 的課程

全球金融危机

1156 個評分

Yale University

全球金融危机

1156 個評分

Former U.S. Secretary of the Treasury Timothy F. Geithner and Professor Andrew Metrick survey the causes, events, policy responses, and aftermath of the recent global financial crisis.

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Safe Assets and the Global Savings Glut

Summary: Safe Assets and the Global Savings Glut2:55

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Andrew Metrick
Michael H. Jordan Professor of Finance and Management
Yale School of Management
Timothy Geithner
Lecturer in Management, Yale SOM, Former U.S. Secretary of the Treasury
Yale School of Management

[SOUND] Let's summarize what we've learned in this module.

First, in the years leading up to the global financial crisis,

the global demand for safe assets, which we've called information

insensitive assets increased significantly predominantly from countries

with significant current account surpluses as the global savings glut

countries from European banks and from institutional cash pulls.

The supply of safe government debt was insufficient to meet this excess demand.

It's a very big change in the world, and over these years, the demands increased,

but the supply that was coming from the traditional sources, the government and

agencies of the government, was insufficient to meet that demand.

Financial institutions responded as they always do,

by manufacturing what was needed.

This is something financial institutions did in the United States in the early

19th century with bank notes that would serve as currency, in the late 19th

century by creating demand deposits, checking accounts, that would effectively

serve as money and they would continue this process of meeting the demands for

safe transactions media type of assets all throughout of modern financial history.

In the 21st century they primarily use securitization to do this.

Securitization is a very useful activity in the abstract,

even for non financial firms.

It's bankruptcy remote when we create a securitization vehicle, it is bankruptcy

remote from the parent, and thus from any managerial risk of the parent.

And furthermore, it can use efficient liquidation itself

if it is in distress and the value of the underlying assets fall.

Altogether, there's a lot of efficiency gains to this.

And as long as you can do it in a way where the majority of the debt that has

been created is indeed safe, information insensitive debt,

then you have managed just like banks who created checking accounts

to create a financial instrument that is serving a very important purpose.

The problem happens when what you have created that used to seem safe and

information insensitive suddenly starts to seem like it is not safe.

That's the same problem that we've had in bank runs from the beginning of time.

If the bank had demand deposits and you thought of them as safe.

And the checks from that bank is safe, and then all of a sudden you got worried about

the underlying solvency of that bank, and those demand deposits were no longer safe.

That same thing is what happened in securitization,

and we will talk a lot more about that over the next few modules.

[MUSIC]

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