Financial crises & how to fight them. steven.kelly@yale.edu Substacking on financial stability topics at www.withoutwarningresearch.com (free)https://bsky.app/profile/stevenkelly49.bsky.socialhttps://bsky.app/profile/stevenkelly49.bsky.social/post/3ltnjdlyz2k27"But it’s not often remarked that ordinary Americans have already — and for years — been buying vast amounts of complex exposure to private equity risk. "They’ve just been doing so (without realising it) through their boring old life cover and fixed annuities." [contains quote post or other embedded content]10 Jul 2025 23:48 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3ltnjdlyz2k27https://bsky.app/profile/stevenkelly49.bsky.social/post/3ltkcqgoyus2o"All in all, 'democratising' access to private credit may undermine the very features that have sustained its growth." [contains quote post or other embedded content]09 Jul 2025 17:12 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3ltkcqgoyus2ohttps://bsky.app/profile/stevenkelly49.bsky.social/post/3lsjqq6syzc2pA guest spot over at Odd Lots: "When Should We Care About Unrealized Bank Losses?" https://www.bloomberg.com/news/newsletters/2025-06-26/when-should-we-care-about-unrealized-bank-losses26 Jun 2025 18:24 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lsjqq6syzc2phttps://bsky.app/profile/stevenkelly49.bsky.social/post/3lsgwhzesgc2r"Yale Program on Financial Stability Presents Financial Crisis-Fighting Playbook" https://som.yale.edu/story/2025/yale-program-financial-stability-presents-financial-crisis-fighting-playbook25 Jun 2025 15:29 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lsgwhzesgc2rhttps://bsky.app/profile/stevenkelly49.bsky.social/post/3lscuwf5twc23JPM’s Naveen Mallela: “From an institutional standpoint, deposit tokens are a superior alternative to stablecoins. Because they are based on fractional banking, we think it is more scalable.” https://www.bloomberg.com/news/articles/2025-06-17/jpmorgan-to-pilot-deposit-token-jpmd-on-coinbase-linked-public-blockchain24 Jun 2025 00:50 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lscuwf5twc23https://bsky.app/profile/stevenkelly49.bsky.social/post/3lroe2ddkdk2pNew, short note: "The Financial Stability Implications of Each Possible Stablecoin Reserves Model" https://www.withoutwarningresearch.com/p/the-financial-stability-implications15 Jun 2025 20:55 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lroe2ddkdk2phttps://bsky.app/profile/stevenkelly49.bsky.social/post/3lriwvct5nc2p"Ad Hoc Emergency Liquidity Assistance in the 21st Century: Necessary, but Never Sufficient" Our recent paper (w/ Vincient Arnold, Greg Feldberg, and Andrew Metrick) is now out as a policy brief with the European Money & Finance Forum: https://www.suerf.org/publications/suerf-policy-notes-and-briefs/ad-hoc-emergency-liquidity-assistance-in-the-21st-century-necessary-but-never-sufficient/13 Jun 2025 17:16 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lriwvct5nc2phttps://bsky.app/profile/stevenkelly49.bsky.social/post/3lrhdxo7zlc2pBank CFOs describing the Great Bank Re-Tranche phenomenon perfectly:13 Jun 2025 02:05 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lrhdxo7zlc2phttps://bsky.app/profile/stevenkelly49.bsky.social/post/3lql5ozjj3s24Episode # 10000000 of “There’s a reason we have banks and structure them the way we do”01 Jun 2025 20:58 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lql5ozjj3s24https://bsky.app/profile/stevenkelly49.bsky.social/post/3lq6ab2yaks26https://www.ft.com/content/625f9f0e-0144-4bc4-99e2-571ab64ccbe927 May 2025 17:40 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lq6ab2yaks26https://bsky.app/profile/stevenkelly49.bsky.social/post/3lppygmqqk22kA new FDIC disclosure shows the text of its 2023 "systemic risk exception" board resolution to rescue the SVB/Signature uninsured depositors. As noted below, the resolution included First Republic, which wasn't ultimately closed for another 6 weeks: [contains quote post or other embedded content]22 May 2025 01:42 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lppygmqqk22khttps://bsky.app/profile/stevenkelly49.bsky.social/post/3lppkduf4os2jBloomberg "suffered widespread disruption on Wednesday morning that prevented traders from accessing live pricing and pushed back UK and EU sovereign debt auctions." [contains quote post or other embedded content]21 May 2025 21:30 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lppkduf4os2jhttps://bsky.app/profile/stevenkelly49.bsky.social/post/3lpn62zowrs2t20 May 2025 22:45 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lpn62zowrs2thttps://bsky.app/profile/stevenkelly49.bsky.social/post/3lpeznilpvk2x"What Has Changed Since Silicon Valley Bank Collapsed? Not Much." https://www.nytimes.com/2025/05/17/business/dealbook/runnable-funds-silicon-valley-bank.html17 May 2025 17:05 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lpeznilpvk2xhttps://bsky.app/profile/stevenkelly49.bsky.social/post/3lp35gf5ixc2uBrazil's central bank (BCB) has announced swap agreement w/ the PBoC. But, not to lose any friends, the press release specifically mentions also having access to the Fed's FIMA facility, "which allows the BCB to access US dollars through a repo operation." Translated:13 May 2025 18:46 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lp35gf5ixc2uhttps://bsky.app/profile/stevenkelly49.bsky.social/post/3lozelvze5s2tCredit Suisse was a bank from which a thousand case studies will bloom. Now out in the Journal of Financial Crises—with Jack French and Owen Heaphy—we take a look at the Swiss government's emergency liquidity assistance, which Credit Suisse drew on for over $180 billion: https://elischolar.library.yale.edu/journal-of-financial-crises/vol7/iss1/18/13 May 2025 01:49 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lozelvze5s2thttps://bsky.app/profile/stevenkelly49.bsky.social/post/3loidt32pcc2eThere are three certainties in life: death, taxes, and Credit Suisse somehow avoiding both [contains quote post or other embedded content]06 May 2025 07:20 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3loidt32pcc2ehttps://bsky.app/profile/stevenkelly49.bsky.social/post/3lobznkabgc23“The secondary market will hit record levels this year with deal volume in the range of $162 billion to $182 billion as private markets continue to expand and LPs look for liquidity, according to Evercore Inc. That’s expected to lure increased capital…” https://www.bloomberg.com/news/articles/2025-05-01/apollo-raises-5-4-billion-fund-for-secondhand-private-equity03 May 2025 19:02 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lobznkabgc23https://bsky.app/profile/stevenkelly49.bsky.social/post/3lnjm5gxfgc22The IMF Global Financial Stability Report on the importance of the dollar swap lines, specifically for Europe: [contains quote post or other embedded content]24 Apr 2025 01:56 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lnjm5gxfgc22https://bsky.app/profile/stevenkelly49.bsky.social/post/3lmzqeb4tbk2yGreat to hop on the UBS podcast to discuss "the state of financial stability." Lots on the usual suspects: Treasury market, private credit, etc. Also, why I don't think the weakening of the dollar represents a changing of the "flight to safety" order (yet, at least): https://podcasts.apple.com/us/podcast/the-state-of-financial-stability-with-steven/id1447407862?i=100070374435917 Apr 2025 18:29 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lmzqeb4tbk2yhttps://bsky.app/profile/stevenkelly49.bsky.social/post/3lmwv4fwfrc2bNew paper: "Ad Hoc Emergency Liquidity Programs in the 21st Century" w/ Vincient Arnold, Greg Feldberg, & Andrew Metrick How do policymakers design emergency rescue loans? And how should they? We survey 22 high-profile, modern emergency loan cases: https://elischolar.library.yale.edu/journal-of-financial-crises/vol7/iss1/3/16 Apr 2025 15:16 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lmwv4fwfrc2bhttps://bsky.app/profile/stevenkelly49.bsky.social/post/3lmpgvqhjyc27Less-known of the SVB & Signature rescue weekend, policymakers had prepared a bridge bank and invoked the "systemic risk exception" for First Republic too. But First Republic stayed open & soon got $30bn from other banks. New case study on that rescue w/ Salil Gupta & Jack French: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=521152513 Apr 2025 16:13 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lmpgvqhjyc27https://bsky.app/profile/stevenkelly49.bsky.social/post/3lml5i3ldo22zThe government (in)famously did not provide a rescue loan to Lehman. The Fed did, however, lend substantially to the firm dealer subsidiary. @ayogeorge.bsky.social & I have a new case study on this intervention, which also squares that apparent inconsistency. In the Journal of Financial Crises: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=521152711 Apr 2025 23:14 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3lml5i3ldo22zhttps://bsky.app/profile/stevenkelly49.bsky.social/post/3llsd4tf52c2v“Tether’s CEO says his $144 billion stablecoin is good for the U.S. dollar. Is he right?” https://finance.yahoo.com/news/tether-ceo-says-144-billion-143830984.html02 Apr 2025 02:18 +0000at://did:plc:7cpdlddyfbukheedyjtpfvb5/app.bsky.feed.post/3llsd4tf52c2v