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The Bankers' New Clothes What's Wrong with Banking and What to Do About It

Details

May 21, 2013 5:30pm - 7:00pm

Room 180

5:30 pm Reception
6:00 pm - 7:00 pm Presentation

Join Stanford Graduate School of Business Professor Anat Admati for a discusssion on her new book The Bankers' New Clothes. Introduction by Stanford Law School Professor Michael Klausner.

What is wrong with today's banking system? The past few years have shown that risks in banking can impose significant costs on the economy. Many claim, however, that a safer banking system would require sacrificing lending and economic growth. This presentation will examine this claim and the narratives used by bankers, politicians, and regulators to rationalize the lack of reform, exposing them as invalid.
Anat Admati argues that we can have a safer and healthier banking system without sacrificing any of the benefits of the system, and at essentially no cost to society. They show that banks are as fragile as they are not because they must be, but because they want to be--and they get away with it. Whereas this situation benefits bankers, it distorts the economy and exposes the public to unnecessary risks. Weak regulation and ineffective enforcement allowed the buildup of risks that ushered in the financial crisis of 2007-2009. Much can be done to create a better system and prevent crises. Yet the lessons from the crisis have not been learned.

You can find out more details about the book at http://bankersnewclothes.com/http://bankersnewclothes.com/.