Limits to safety net support - Richmond's Lacker

It is of paramount importance to clearly define the boundaries of future safety net support, said Jeffrey Lacker, the president of the Richmond Federal Reserve.

Lacker said that the ambiguity about which institutions are "too big to fail" contributed significantly to the incentives of large financial institutions to pursue strategies focused on leveraged growth and off-balance-sheet risks, which ultimately added to the instability of markets.

"Redesigning our financial regulatory system before

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