Indirect contagion The policy problem. No 9 / January 2016
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Other documents of the author: European Systemic Risk Board; Clerc, Laurent; Langfield, Sam; Giovannini, Alberto; Portes, Richard; Scheicher, Martin; Peltonen, Tuomas
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Title
Indirect contagion The policy problem. No 9 / January 2016Author (s)
DOI
10.2849/270774Date
2016-12-15Abstract
This paper represents an attempt to move systemic risk analysis closer to the holism of epidemiology. In doing so, we begin by identifying the fundamental channels of indirect contagion, which manifest even in the ... [+]
This paper represents an attempt to move systemic risk analysis closer to the holism of epidemiology. In doing so, we begin by identifying the fundamental channels of indirect contagion, which manifest even in the absence of direct contractual links. The first is the market price channel, in which scarce funding liquidity and low market liquidity reinforce each other, generating a vicious spiral.
The second is information spillovers, in which bad news can adversely affect a broad range of financial firms and markets. [-]
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978-92-95081-25-3Type
info:eu-repo/semantics/workingPaperPublisher
European Systemic Risk BoardRights
http://rightsstatements.org/vocab/CNE/1.0/
info:eu-repo/semantics/openAccess
info:eu-repo/semantics/openAccess