Showing papers by "George G. Kaufman published in 1988"

The Truth About Bank Runs

Abstract: Bank runs have taken a bum rap. A shout of “run” strikes the same fear into most of us as a shout of “fire” in a crowded room might. After all, it is better to be safe than sorry. Not only will depositors run to the affected bank to withdraw their funds, but depositors elsewhere may also run on unaffected banks. Bank runs are frequently viewed as contagious, with people thinking, “If my neighbor’s bank is in trouble, maybe mine is also.” Thus, a run on one bank is believed capable of causing not only that bank to fail but also, domino fashion, the failure of a large number of banks nationwide, thus destabilizing the financial system if not the economy as a whole.

Durations of Non-Default-Free Securities

Abstract: (1988). Durations of Non-Default-Free Securities. Financial Analysts Journal: Vol. 44, No. 4, pp. 39-46, 62.

Securities activities of commercial banks: Recent changes in the economic and legal environments

Abstract: Despite the lack of changes in the Glass-Steagall Act, commercial banks have expanded their securities activities substantially in recent years. The increase reflects more liberal interpretations of the Glass-Steagall restrictions by the bank regulatory agencies and the courts, greater aggressiveness by the banks in searching out new areas of profitability to offset declining profitability in some traditional banking activities, advances in data processing technology that both permit the design of new securities and promise economies of scope, and increased internationalization of financial markets that provide U.S. banks with experience in securities activities abroad. As a result of the de facto dismantling of the Glass-Steagall Act that is documented in this article, de jure dismantling is less important than in the past, although it is still desirable for the sake of increased efficiency.