The Financial Cesspools. A Critical Analysis of "Bad Banks" as Financial Instruments


Essay, 2012

6 Pages, Grade: 1.67


Abstract or Introduction

"The cardinal maxim is that any aid to a present bad bank is the surest mode of preventing the establishment of a future good bank" wrote the British economic journalist Walter Bagehot in 1873. In his evaluative analysis, Bagehot stretched the potential problems that may arise as a result of government's interventions. Although there has been more than a century since his comments on the pre-mature idea of a bad bank and interventions, the discussions on the utility of bad banks persists in today's financial spectrums. In economic terminology, bad banks are used to take risky assets from otherwise good banks. This essay will first address the idea of so-called bad banks as a new financial instrument and then will focus on the analysis of their impacts on crises development.

Details

Title
The Financial Cesspools. A Critical Analysis of "Bad Banks" as Financial Instruments
College
Jacobs University Bremen gGmbH
Course
Financial Constitution (in Time of Crisis)
Grade
1.67
Author
Year
2012
Pages
6
Catalog Number
V293832
ISBN (eBook)
9783656915256
ISBN (Book)
9783656915263
File size
563 KB
Language
English
Keywords
financial, cesspools, critical, analysis, banks, instruments
Quote paper
Kaan Akkanat (Author), 2012, The Financial Cesspools. A Critical Analysis of "Bad Banks" as Financial Instruments, Munich, GRIN Verlag, https://www.grin.com/document/293832

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