NYT DealBook, June 9, 2008
Timothy F. Geithner has lived through the rockiest moments of the credit squeeze that have battered the global financial system, leading to the collapse of Bear Stearns. Now he has some ideas to help prevent a future crisis.
In Monday’s Financial Times, the president of the New York Federal Reserve Bank outlines several steps to help shore up what he calls a “fragile” financial network. Among his proposals: greater capital and liquidity requirements for big financial institutions; more robust and exacting supervision of both financial institutions and complex, highly levered derivatives; and more secure and formalized connections among the largest central banks to better work in concert should another potential catastrophe loom on the horizon.
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