Bank failures are back in the news, after three of the United States’ 30 largest banks collapsed in the past three months. These bank failures and the policy responses to date have taught us several important lessons about why such crises keep happening in the U.S. and how policymakers can act to break this self-destructive cycle.
Following recent turbulence in Western financial markets, many states without vast resources at their disposal are teetering at the edge of financial collapse. As an increasing number of emerging markets face brutal choices, the impact of inflation and austerity could increase the likelihood of political crises and armed conflicts.
