Tainted Tea Leaves: How Market Expectations Can Lead Regulators Astray

Jun 2, 2009 / By Knowledge@Wharton.com
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How can you judge a bank's health—and make policy choices based on that judgment—when you don't know what market forces are driving its value? Wharton professors Itay Goldstein and Philip Bond think that's exactly the mistake that government regulators are making and they propose corrective measures.

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