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The Financial Safety Net – a Necessity in a Turbulent Financial World

Author

Listed:
  • Peter BALOGH

    (Babes-Bolyai University, Cluj-Napoca, Romania)

  • Nicu TOCU

    (Alexandru Ioan Cuza University, Iasi, Romania)

Abstract

Over the last years we observed that whenever crisis hits, interest in guarantee arrangements rises. The current financial crisis is no exception in this respect. It turns the spotlight on the operation of the financial safety net and provides policy makers with a unique opportunity to monitor its performance and, more specifically, to identify its strengths and weaknesses. The aim of this paper is to demonstrate the need of financial safety nets in a world characterized by deep financial disruptions, describing also the main components of a well-built financial safety net.

Suggested Citation

  • Peter BALOGH & Nicu TOCU, 2012. "The Financial Safety Net – a Necessity in a Turbulent Financial World," Economics and Applied Informatics, "Dunarea de Jos" University of Galati, Faculty of Economics and Business Administration, issue 2, pages 23-30.
    • Handle: RePEc:ddj:fseeai:y:2012:i:2:p:23-30
    as

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    File URL: http://www.ann.ugal.ro/eco/Doc2012.2/Balogh_Tocu.pdf
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    References listed on IDEAS

    as
    1. Sebastian Schich, 2009. "Financial crisis: Deposit insurance and related financial safety net aspects," OECD Journal: Financial Market Trends, OECD Publishing, vol. 2008(2), pages 1-39.
    2. Corsetti, Giancarlo & Guimaraes, Bernardo & Roubini, Nouriel, 2006. "International lending of last resort and moral hazard: A model of IMF's catalytic finance," Journal of Monetary Economics, Elsevier, vol. 53(3), pages 441-471, April.
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    More about this item

    Keywords

    Financial safety net; Crises; Central bank;
    All these keywords.

    JEL classification:

    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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