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Assessing Financial Stability: Exploring the Boundaries of AnalysisEuropean Central Bank, john.fell{at}ecb.int
International Monetary Fund, gschinasi{at}imf.org Within the context of a practical framework for safeguarding financial stability - entailing both prevention and resolution - this paper discusses the practical boundaries and challenges of assessing financial stability. The paper characterises the financial stability challenge, discusses concepts and definitions essential for safeguarding stability, and puts forward a practical process (but not a blueprint) for assessments. The paper proposes guidelines for disciplining an assessment process, examines measurement and modelling ambiguities, and identifies areas where significant further progress is necessary.
Key Words: Financial stability risks and vulnerabilities
National Institute Economic Review, Vol. 192, No. 1,
102-117 (2005) |
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