Yale School of Management

Content Tagged as Finance

Does the past help us predict the future of financial markets?

The increasing complexity of financial instruments, the growing globalization of markets, and the increasing scale of major financial institutions all collided in the financial crisis of 2008. Has the crisis changed the markets for good? Should we expect major shifts in the long-term returns and volatility of different asset classes? What are the long-term consequences of automated trading, globalization, and other macro-trends?

Does focusing on shareholder value hurt shareholder value?

Shareholders own the corporation, so managers should maximize returns for shareholders, right? Corporate law expert Lynn Stout says that there are problems with this argument, starting with the fact that legally shareholders don't own a corporation. On top of that, she says, prioritization of shareholder value harms returns in the long run.

Can a bank serve its community?

Mary Houghton is the president and co-founder of the ShoreBank Corporation, the largest and oldest community development bank in the country. She talks with Qn about how banking can be a powerful for-profit social venture.

Is risk rational?

Misunderstanding of risk was a major factor in the subprime crisis and ensuing recession. Andrew Lo argues that one has to look at both logical and emotional parts of the brain to grasp how people respond to financial risk.

What's the lesson of Iceland's collapse?

Iceland may have been a forerunner of 21st century financial trends. First it profited from increasing integration with the global financial system. Then ties to the world economy helped pull it into fiscal ruin. What can an island with less than .005% of the world’s population teach us about globalization?