The Impact of Extraordinary Monetary Policy on the Financial Sector

Posted On November 22, 2017

December 1, 2016 – December 2, 2016

Federal Reserve Bank of Atlanta

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The Center for Financial Innovation and Stability (Federal Reserve Bank of Atlanta) and the Center for the Economic Analysis of Risk (Georgia State University) are organizing the conference “The Impact of Extraordinary Monetary Policy on the Financial Sector”, to be held at the Federal Reserve Bank of Atlanta on the 1st and 2nd of December 2016. The aim of the conference is to bring together economists, statisticians, finance professionals and regulators in order to discuss the impact of the extraordinary monetary policy interventions of central banks during and after the financial crisis on the financial sector.

Central banks in many developed countries adopted a number of extraordinary measures to relieve liquidity strains during the financial crisis. As the crisis abated, many of these central banks took extraordinary measures to help their economies recover from the Great Recession. In many cases the post-crisis measures continue (large balance sheets) or have even been expanded (the move from near zero policy rates to negative rates). Moreover, these post-crisis measures may interact with a variety of post-crisis regulatory developments including stricter leverage requirements, minimum liquidity requirements and increased collateralization of OTC derivatives. These measures have had and are continuing to having a variety of consequences, both intended and unintended, for financial markets and institutions. This conference seeks to develop a better understanding of crisis related actions on the financial system as central banks are likely to face similar pressures at some point in the future. Additionally, this conference seeks to improve our understanding of how recent and current extraordinary measures are impacting the financial system.

Paper Submission

Submissions are no longer being accepted. We invite academics, professionals and regulators to submit papers for this meeting. Long abstracts or, preferably, complete manuscripts may be submitted no later than the September 5, 2016 on the full range of issues associated with the impact of extraordinary monetary policy on the financial sector.

Some examples of such issues arising from extraordinary monetary policy during the crisis include:

  • The effect of policy actions on market prices and/or quantities during the crisis.
  • Moral hazard after the crisis.

Some examples of issues arising from post-crisis extraordinary monetary policy include the impact on:

  • Term and risk premia in bond markets,
  • Exchange rates,
  • Equity prices,
  • Risk taking by financial intermediaries,
  • The business models of financial intermediaries (e.g., the impact of negative rates on insurance companies, pension funds and retail banking operations),
  • The reduction of high quality, liquid assets available for repo transactions and to meet increased regulatory demand for these assets.
  • The financial sector in developing countries.

The selection committee consists of Nikolay Gospodinov (Federal Reserve Bank of Atlanta), Glenn Harrison (Georgia State University and CEAR), Felix Rioja (Georgia State University), John Robertson (Federal Reserve Bank of Atlanta), Skander J. Van den Heuvel (Federal Reserve Board and European Central Bank), and Larry Wall (Federal Reserve Bank of Atlanta and CenFIS). The results of the selection process will be sent by the 7th of October 2016. Reasonable travel and accommodation expenses will be covered for the presenters of accepted papers.