Can banks police each other

Article Abstract:

Governments may provide aid for banks in order to prevent systemic failure which could result from a single institution failing. Banks can obtain more aid the greater the problems theyhave got themselves into, and this creates a problem of moral hazard, with risky behavior being rewarded. Some theorists argue that banks should be more closely supervised, while others argue that they should receive less public sector aid, except for a small group of banks. The problem of moral hazard does not have an easy solution and cannot entirely be eradicated.

Banking industry

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A new approach to financial risk

Article Abstract:

Investors have moved away from risk in world financial markets, and there have been calls for greater regulation of hedge funds. The problems of Long-Term Capital Management have highlighted this issue, but this was not a typical hedge fund, and the financial instablity that has hit hedge funds may not be repeated. There is concern, however, that globalization and new technology may mean that instability becomes more frequent. Some banks are effectively backed by taxpayers, and there is a case for greater regulation of their exposure to risk.

Financial Services, Finance and Insurance, Editorial, Column, Financial markets, Hedge funds

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Old MacDonald had an option: crop insurance

Article Abstract:

American farmers have increasingly turned to investing in derivatives as a way to offset reduced disaster assistance from the federal government and a proposed reduction in price supports. Farmers must now possess financial as well as farm knowledge to survive economically.

Regulation of Agricultural Marketing and Commodities, Farm Income Stabilization, Agriculture, Usage, Investments, Derivatives (Financial instruments), Agricultural subsidies, Insurance, Farmers, Farm income

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