Financial Innovation and Risk Management: The Cross-Guarantee Solution
Working Paper No. 141
19 Pages Posted: 19 Aug 1998
The cross-guarantee concept will eliminate the regulatory moral hazard that electronic technology has greatly exacerbated in recent years. The paper concludes by outlining the many benefits cross-guarantees will bring to the financial system as well as the structural and international implications of using cross-guarantees to bring market-driven regulation to the financial services sector of the American economy.
JEL Classification: G21, G28
Suggested Citation: Suggested Citation