The Federal Reserve Bank of New York works to promote sound and well-functioning financial systems and markets through its provision of industry and payment services, advancement of infrastructure reform in key markets and training and educational support to international institutions.
The New York Fed engages with individuals, households and businesses in the Second District and maintains an active dialogue in the region. The Bank gathers and shares regional economic intelligence to inform our community and policy makers, and promotes sound financial and economic decisions through community development and education programs.
U.S. Bank Holding Companies (BHCs) currently control about 3,000 subsidiaries that provide community housing services—such as building low-income housing units, maintaining shelters, and providing housing services to the elderly and disabled. This aspect of U.S. BHC activity is intriguing because it departs from the traditional deposit-taking and loan-making operations typically associated with banks. But perhaps most importantly, the sheer number of these subsidiaries makes one think about the organizational complexity of U.S. BHCs. This is an issue that has generated much discussion in recent years. In this post we describe the emergence and growth of community housing subsidiaries and discuss to what extent they contribute to the complexity of their parent organizations.
Since the height of the financial crisis, each year the Federal Reserve has disclosed the results of its stress tests, and stress testing has become “business as usual” in the U.S. banking industry. In this post, we assess whether market participants find supervisory stress test disclosures informative. After half a decade, do the disclosures still contain information that the market finds valuable?
The Big Short has been making a big splash this year, racking up five Academy Award nominations and taking home the Oscar for best adapted screenplay. The movie provides a very entertaining way to gain an understanding about some of the underpinnings of the financial crisis, particularly through a few memorable cutaway scenes—such as when actress Margot Robbie explains mortgage-backed securities (MBS) from a bubble bath, chef Anthony Bourdain compares collateralized debt obligations (CDOs) to seafood stew, and singer Selena Gomez explains synthetic CDOs using the analogy of “side bets” made by people watching a casino blackjack game.
Liberty Street Economics features insight and analysis from economists working at the intersection of research and policy. The editors are Michael Fleming, Andrew Haughwout, Thomas Klitgaard, and Donald Morgan.
The views expressed are those of the authors, and do not necessarily reflect the position of the New York Fed or the Federal Reserve System.
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