Aaron Klein amd Senator Jack Reed
Finance is a complicated and interconnected industry where assets and liabilities change quickly, particularly during periods of stress. Keeping track of billions of accounts and transactions across firms, counterparties, investors, clients, and regulators is a major undertaking. The great financial crisis of 2008 exposed just how great a challenge this is: At that time, it was difficult to gauge the magnitude of the crisis because this information either didn’t exist or, if it did, it wasn’t standardized across the sector. The uncertainty around who owed whom and how much they owed compounded the crisis and made it difficult to formulate a quick response.
Coming out of the financial crisis, a global commitment was made to improve financial data standardization, collection, and dissemination. Fifteen years, a pandemic, and a series of bank failures later, it is time to check our progress. Does the data exist and is it standardized, disseminated, and shared?
On December 14, the Center on Regulation and Markets at Brookings gathered current and former regulators, leading academics, and industry experts to answer this question. They discussed what progress has been made, identified additional gaps to be filled, and explored efforts to re-energize data collection practices in the United States to help guard against future financial system collapses. This event was a part of the Center’s “Series on Financial Markets and Regulation.”
Photo Credit: Paul Morigi
Aaron Klein amd Senator Jack Reed
Finance is a complicated and interconnected industry where assets and liabilities change quickly, particularly during periods of stress. Keeping track of billions of accounts and transactions across firms, counterparties, investors, clients, and regulators is a major undertaking. The great financial crisis of 2008 exposed just how great a challenge this is: At that time, it was difficult to gauge the magnitude of the crisis because this information either didn’t exist or, if it did, it wasn’t standardized across the sector. The uncertainty around who owed whom and how much they owed compounded the crisis and made it difficult to formulate a quick response.
Coming out of the financial crisis, a global commitment was made to improve financial data standardization, collection, and dissemination. Fifteen years, a pandemic, and a series of bank failures later, it is time to check our progress. Does the data exist and is it standardized, disseminated, and shared?
On December 14, the Center on Regulation and Markets at Brookings gathered current and former regulators, leading academics, and industry experts to answer this question. They discussed what progress has been made, identified additional gaps to be filled, and explored efforts to re-energize data collection practices in the United States to help guard against future financial system collapses. This event was a part of the Center’s “Series on Financial Markets and Regulation.”
Photo Credit: Paul Morigi