Banking, Reinsurance, and the Fed: A Thought Experiment on Risk Pools

Banking, Reinsurance, and the Fed: A Thought Experiment on Risk Pools What if we looked at banks the way we look at insurers—and the Federal Reserve as an excess-of-loss carrier? And what if we removed that carrier from the stack? The Core Analogy: Banking Is a Risk Business Banks transform short-term deposits into long-term loans. [...]