A Quote by Myron Scholes
Most of the time, your risk management works. With a systemic event such as the recent shocks following the collapse of Lehman Brothers, obviously the risk-management system of any one bank appears, after the fact, to be incomplete. We ended up where banks couldn't liquidate their risk, and the system tended to freeze up.
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A bank needs models to measure risk. The problem, however, is that any one bank can measure its risk, but it also has to know what the risk taken by other banks in the system happens to be at any particular moment.
Given the central role of effective, firmwide risk management in maintaining strong financial institutions, it is clear that supervisors must redouble their efforts to help organizations improve their risk-management practices...We are also considering the need for additional or revised supervisory guidance regarding various aspects of risk management, including further emphasis on the need for an enterprise-wide perspective when assessing risk.
Risk managers and investment bankers and actually, all kinds of investors took on more risk than they expected. So there was a failure of risk management. There was a failure to recognize how much risk there was in some of these securities that people bought.
While the move to central clearing has made the system safer, we need to make sure that the central counterparties have the resources and risk-management practices to withstand plausible but severe shocks.
In the financial system we have today, with less risk concentrated in banks, the probability of systemic financial crises may be lower than in traditional bank-centered financial systems
In the financial system we have today, with less risk concentrated in banks, the probability of systemic financial crises may be lower than in traditional bank-centered financial systems.
To laugh is to risk appearing a fool. To weep is to risk appearing sentimental. To reach out to another is to risk involvement. To expose feelings is to risk exposing your true self. To place your ideas and dreams before a crowd is to risk their loss. To love is to risk not being loved in return. To hope is to risk pain. To try is to risk failure. But risks must be taken, because the greatest hazard in life is to risk nothing.
If you have an approach that makes money, then money management can make the difference between success and failure... ... I try to be conservative in my risk management. I want to make sure I'll be around to play tomorrow. Risk control is essential.
Keeping the risk management plan up to date can transform it from a door stop into a vital project management tool. Remember: what you don't know can kill your project.
The risk of working with people you don't respect; the risk of working for a company whose values are incosistent with your own; the risk of compromising what's important; the risk of doing something that fails to express-or even contradicts--who you are. And then there is the most dangerous risk of all--the risk of spending your life not doing what you want on the bet that you can buy yourself the freedom to do it later.
In truth, in the fairy-tale version of bailing out Lehman, the next domino, A.I.G., would have fallen even harder. If the politics of bailing out Lehman were bad, the politics of bailing out A.I.G. would have been worse. And the systemic risk that a failure of A.I.G. posed was orders of magnitude greater than Lehman's collapse.
Unfortunately, tools that transfer risk can also increase systemic risk if major counterparties fail to manage their own risk exposures properly.
Operational risk is the risk of loss resulting from bank operational failures, such as rogue traders, fraudulent sales practices, and cyber risks. Operational risk capital is money or assets that banks have to hold to shield the economy from the consequences of these kinds of failures.
Being a Navy SEAL and sniper taught me all about risk management. Take away all the risk variables under your control and reduce it to an acceptable level. The same fundamentals apply in business.
Security incidents have gone up 5-10 times during the pandemic, so there is an increased need for security operations risk management, identity and access management, data privacy and compliance.
Whenever you're in a natural system and you're making sound, you are putting yourself at risk. As you go up the evolutionary ladder, from insects to frogs to birds and on up into mammals, the higher intelligence recognizes that when you vocalize, you put yourself at risk. So mammals generally vocalize or make noise much more rarely than, let's say, insects or frogs. And when they do, and put themselves at risk, it has to be worth the risk, and have true meaning, such as signaling during a hunting party, calling in prey, some religious or spiritual ceremony, something like that.
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