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When I take a loan I may also fail to deliver loan payments. I don't think we should make risk illegal, but we should make sure that banks manage tail risks rig
by konschubert 6y ago
When I take a loan I may also fail to deliver loan payments. I don't think we should make risk illegal, but we should make sure that banks manage tail risks right.
- eru 6y agoThat's what margin requirements and clearing houses are for. Even during the heights of the last few financial crises, clearinghouses did not fail. (Option writers and people trading futures are in a very similar situation to short sellers. They also have clearing houses.)