This is a view into the internal structure of the state of financial stability that usually
assumed as a simple and obvious or as a “black box” with no interesting internal
construction. This systemic dynamic view gives possibilities for deeper realizing of
the financial stability nature and shedding some light on some important systemic
effects.
The problems of financial stability unified generally accepted definition
absence and paradoxes of monetary policy. As we know, the monetary stability is
the stability of the general level of consumer prices, or absence inflation or deflation.
At the same time, in spite of the seeming obviousness and simplicity of the financial
stability conception, the unified generally accepted definition of this term is absent
until now. The existing different definitions of financial stability bases on the various
approaches: direct, reverse (based on financial instability definition) and mixed (Table
1).
Тable 1 The current state of understanding of “financial stability” term
Author
Definition of term “financial stability”
Michael Foot,
Managing director,
The Financial
Services Authority
and Honorary
President of ACI
(UK). What is
financial stability
and how do we get
it., 2003, pp. 2-3
“If I were to ask you to define the term “monetary stability”, there would
probably be broad agreement as to its meaning. . . In contrast, I suggest
there would be mush less agreement about what constitutes financial
stability, though we would probably regard it, like monetary stability, as a
“good thing” …
To progress, we need a definition of financial stability. Let me offer one,
which is that we have financial stability where there is: (a) monetary
stability (as defined above), (b) employment levels close to the economy’s
natural rate, (c) confidence in the operation of the generality of key
financial institutions and markets in the economy and (d) where there are
no relative price movements of either real or financial assets within the
economy that will undermine (a) or (b)”
International
Monetary Fund
«Financial
Soundness
Indicators:
Compilation
Guide”, 2007
«
The primary purpose of this Compilation Guide on Financial Soundness
Indicators is to provide guidance on the concepts and definitions, and
sources and techniques, for the compilation and dissemination of the
financial soundness indicators (FSIs) identified by the IMF’s Executive
Board. The Guide is intended to encourage compilation of FSIs and
promote cross-country comparability of these data, as well as assist
compilers and users of FSI data, for the purpose of supporting national
and international surveillance of financial system”
The definition of the term “financial stability” is absent in this key
conceptual Guide of IMF which is devoted to financial stability (authors)
Crockett Andrew
(BIS, Financial
Stability Forum),
1997
“[We can] define financial stability as an absence of instability … a
situation which economic performance is potentially impaired by
fluctuations in the price of financial assets or by an inability of financial
institutions to meet their contractual obligations”
Garry J. Schinasi
Safeguarding
Financial Stability
(International
Monetary Fund,
2005)
«Financial stability is a condition in which an economy’s mechanisms for
pricing, allocating and managing financial risks (credit, liquidity,
counterparty, market and so forth) are functioning well enough to
contribute to the performance of the economy”
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