Where Rocky Horror Assets Go

This article in Risk Magazine by Navigant's Paul Noring examines the options available to policy-makers with regard to quarantining distressed assets. The article discusses whether "bad banks" and alternative asset protection schemes are viable solutions to stemming the losses that have hindered financial institutions over the past two years. After reviewing the historical use of these measures and their advantages and disadvantages, the author concludes that governments may have to go beyond these measures if they want banks to extend credit at pre-financial-crisis levels.