Interconnectedness and Systemic Risk: Lessons from the Financial Crisis and Policy Implications"

Visit the website of theBoard of Governors of the Federal Reserve System. Read the speech given by then Vice Chair Janet Yellen to the American Economic Association/American Finance Association on January 4, 2013.

Choose and describe one of the "major regulatory and supervisory changes" that Yellen designates as "under way to address the potential for excessive systemic risk arising from the complexity and interconnectedness" characterizing our modern global financial system. Describe the systemic risk and the policy change and its purpose.

Yellen also refers to tradeoffs and cost/benefits that arise from these changes. What are the potential costs and benefits associated with your item? Find...

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