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2021 Financial Stability Conference: Planning for Surprises, Learning from Crises

East 6th Street
Cleveland
OH
44114

What

Financial Stability: Planning for Surprises, Learning from Crises

When

November 17 – November 19, 2021

Where

Virtual Conference

Call for Papers

Financial Stability: Planning for Surprises, Learning from Crises

Organized by the Federal Reserve Bank of Cleveland and the Office of Financial Research


The Federal Reserve Bank of Cleveland and the Office of Financial Research invite the submission of research and policy-oriented papers for the 2021 Financial Stability Conference to be held virtually, November 17–19, 2021.

The disruptions associated with the coronavirus pandemic of 2020, coming just more than a decade after the Great Financial Crisis of 2007–2009, awakened the public and policymakers alike to the dangers of shocks from within and outside of the financial system. These disruptions provided a live-fire stress test for reforms adopted following the Great Financial Crisis, ushering in a new set of responses whose long-term impacts remains to be determined. It drew attention to vulnerabilities in the financial system. Some were foreseen, while other emerged unexpectedly. This year seems an opportune time to not only reflect on the efficacy of these and other past actions, but also to seek reforms to confront the challenges of a new normal, for which once-in-a-lifetime disruptions may come every decade.

Conference Format

To develop these themes, the conference will bring together a mix of policymakers, market participants, and researchers in two types of sessions:

  • Policy Discussions
    These sessions include keynote addresses and panel discussions in which participants from industry, regulatory agencies, and academia share their insights.
  • Research Forums
    These forums follow the format of an academic workshop and include sessions to discuss submitted papers.

Topics

We welcome submissions of research on topics related to potential financial stability risks facing financial markets and institutions, sources of financial system resilience, and related public policy. Conference topics include but are not limited to the following:

Fiscal and Monetary Responses and Financial Stability
In 2020, policymakers responded to the economic fallout from the pandemic with tools both new and old. Monetary policy, macroprudential tools, and fiscal policy have been active parts of the policy toolkit. As the economy begins its return to a new normal, it is critical to understand whether the implementation of these tools was effective and whether implementation produced any unintended consequences. Looking forward, which of these tools deserve a permanent place in the fight against financial crises? To what extent are the effectiveness of these tools moderated by the low interest rate environment, large central bank balance sheets, and large sovereign debt?

  • Regulatory forbearance and its optimal removal
  • International regulatory competition and cooperation
  • Impact of capital and liquidity regulation
  • Interactions between macroprudential and monetary policy
  • Financial stability implications of different monetary regimes (floor, corridor, make-up strategies, standing repo facilities) and nonstandard policies (large balance sheets, negative rates, quantitative easing)
  • Financial stability councils and central banks: Policy coordination with divided responsibility
  • Proliferation of alternative data sources and data needs for policy tools
  • Regtech and regulatory sandboxes
  • Lessons from the international experience

Financial Stability: Shocks and Vulnerabilities
The pandemic provided a major shock to the financial system, revealing both expected and unexpected vulnerabilities. How well did early warning systems and financial stability monitoring efforts prepare regulators, policymakers, and the public in anticipating both the financial shocks that accompanied the pandemic and in assessing financial sector vulnerabilities that exacerbated the effects of these shocks? What lessons did we learn about risk models and about markets, institutions, and the plumbing of the system that will help prepare for the next crisis?

  • Tail risks and uncertainty
  • Risk management and implicit models of risk
  • Supply chain disruptions and resilience
  • Valuation risk for illiquid assets (commercial real estate, leverage loans, and so on)
  • War, terrorism, climate shocks, and cybersecurity

Financial Instability Externalities
One major marker of financial instability is its broad systemic impact. Such impacts can be described by externalities related to spillovers and neighborhood effects. Trouble in one sector often has an impact in another, and externalities are in some cases not fully internalized by involved parties. The need to make individuals take account of these circumstances generates one of the classic justifications for government intervention, be it rules, regulations, or direct market involvement. What previously unseen spillovers did the coronavirus pandemic uncover?

  • Interactions among social, economic, and financial networks in a crisis
  • Lessons from social and epidemiological networks
  • Contagion, networks, and interconnectedness
  • Financial links between real and financial sectors
  • Payment system stress and innovations
  • CCPs, clearinghouses, and derivatives markets
  • Short-term funding, securities financing, and collateralization

Scientific Committee

Simon Gilchrist
Paul Glasserman
Zhiguo He
Maureen O’Hara
Nagpurnanand Prabhala
Hyun Song Shin

Boston University
Columbia Business School
University of Chicago Booth School of Business
Johnson Graduate School of Management at Cornell University
Johns Hopkins University Carey Business School
Bank for International Settlements

Paper Submission Procedure

The deadline for submissions is June 30, 2021. Please submit end complete papers through Conference Maker at 2021 Financial Stability Conference. Notification of acceptance will be provided by September 15, 2021. Final conference papers are due on November 1, 2021. Questions about the call for papers or the conference can be directed to financial.stability.conference@clev.frb.org.