Ex-Fed Governor Tarullo Says Crisis Changed Perception of Economy

The video discusses the changes in the banking system and economy since the financial crisis, highlighting improved risk management and regulation in banks. It addresses ongoing issues like debt and structural economic problems, emphasizing the role of regulation and monetary policy. The shift of risks to shadow banks and asset managers is also explored, raising concerns about potential future crises.

How did the 2008 financial crisis change perceptions of the economy?

• It eliminated financial instability.

• It reduced the need for financial regulation.

• It highlighted the economy's dependence on debt.

• It increased confidence in the banking system.

Which issues are considered outside the Federal Reserve's control?

• Bank risk management

• Short-term borrowing

• Income inequality

• Monetary policy

What is a significant change in how banks borrow money post-crisis?

• Increased reliance on short-term debt

• Greater use of deposits

• More unsecured loans

• Higher interest rates

What role did regulation play in changing banking practices?

• It increased short-term borrowing.

• It reduced the need for deposits.

• It eliminated the need for risk management.

• It helped replace short-term borrowing with deposits.

What is a potential risk associated with the growth of asset managers?

• Reduced market liquidity

• Possibility of a financial crisis

• Higher interest rates

• Increased bank insolvency

What was a concern raised by both the Obama and Trump administrations regarding asset managers?

• Their role in increasing debt

• Their effect on employment

• Their rapid growth

• Their impact on inflation

What shift in the financial sector should be closely monitored?

• Stability in corporate bonds

• Rapid growth exceeding historical ranges

• Increase in short-term borrowing

• Decrease in asset manager growth