September 2008 was a month of falling financial market dominoes: the federal take-over of Fannie Mae and Freddie Mac, followed one week later by the Lehman Brothers failure, the Bank of America agreement to save Merrill Lynch, and the first taxpayer lifeline to American International Group (AIG). The expression “systemic risk” became the new clarion call for policy-makers and regulators as they took unprecedented steps to avoid a collapse of the global financial system.
On September 15, one year after the Lehman collapse, the Brookings Institution hosted a forum to explore the tumultuous events of last September, where financial markets stand today and the status of regulatory reforms designed to prevent the next financial crisis. Federal Reserve Chairman Ben Bernanke gave the keynote address, followed by a panel that included Brookings Senior Fellow and Director of the Initiative on Business and Public Policy Martin Baily; Co-director of Economic Studies Ted Gayer; Senior Fellow Eswar Prasad, Glenn Hutchins—co-founder and co-chief executive of Silver Lake; and AEI Resident Scholar Vincent Reinhart.
Brookings President Strobe Talbott gave introductory remarks, and Brookings Vice President and Co-Director of Economic Studies Karen Dynan moderated the panel.