Company Quote by Robert F. Engle
“When large companies take on risk, then they impose risks on the rest of the system. And these are systemic risks and these systemic risks we never used to think were really that important, but as soon as we recognize how the financial sector - the risks the financial sector takes on can impact the entire global economy, we realize that those risks needed to be controlled for the social good.”
About This Quote
Source Speech: Financial Stability Forum, 2010
Large firms' risk‑taking creates spill‑over dangers that affect the whole economy, requiring regulation for societal benefit.
In simple terms: Big firms' risks can harm everyone, so they must be controlled.
Key Takeaway
Regulate systemic risk for public good.
Themes
finance
systemic risk
regulation
public good
economy
Mood
concerned
analytical
Type
policy
economic
When to use this quote
- policy making
- corporate governance
- risk management
- economic planning
Key Concepts
externalities
moral hazard
financial stability
Questions to Reflect On
- How can we balance innovation with systemic safety?
- What mechanisms best detect emerging systemic risks?
A Different Perspective
Regulation may stifle innovation or be poorly enforced.
![“It has been difficult for [young people in the U.S.] to connect the dots between rising tuition costs and other assaults on their dignity with the ongoing assault on public life and its myriad democratic institutions. Today's generation faces an enormous battle in turning back the current assaults…” quote by Henry Giroux](https://sms4smile.com/quotes/img-quotes/afc/henry-giroux-945_assault_it-has-been-difficult-for-young-people-i_433313.jpg)
