The Post - Crisis Design of the Operational Framework for the Implementation of Monetary Policy –

نویسنده

  • Kalin Nikolov
چکیده

Asset price bubbles are considered to be a major risk to fi nancial stability. In this article, we show that an asset price bubble poses a bigger risk when banks are exposed to it. This is because when the bubble bursts, banks realise losses and this may trigger bank failures and a credit crunch. In contrast, when overvalued assets are held by ordinary savers, the consequences for fi nancial stability are less severe. We show that low bank profi tability and a generous fi nancial safety net for banks are important determinants in their decisions to take risks.

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تاریخ انتشار 2012