Government intervention to guard against systemic risk

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1. Was deposit insurance intended primarily to save depositors from loss or to do so with the bigger goal in mind of preventing bank runs that cause systemic risk? Can one have a stable currency, stable credit and stable economy without creating institutions with too much power or without creating the need for government intervention to guard against systemic risk?

2. Do you think the reforms put in at the end of the S&L crisis will prevent such a crisis from happening again?

Reference no: EM133062575

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