Tip Sheet: University of Virginia Experts on the Financial Crisis


Newswise — BusinessWeek judges the University of Virginia's McIntire School of Commerce to be in a "virtual dead heat" with University of Pennsylvania's Wharton School as the best undergraduate business school in the country [http://www.virginia.edu/uvatoday/newsRelease.php?id=4348]. U.Va.'s separate graduate business school, the Darden School of Business, is also highly ranked. Together they have more than a dozen faculty who are regularly featured in national and international media discussing the financial crisis, from problems with the bailout strategy to global capital flows and America's low savings rate, to lessons from past financial crises. They are listed below by areas of expertise.

Big-picture and history of financial crises and bailouts

"¢ Robert F. BrunerDean of the Darden School of Business, University of VirginiaDistinguished Professor of Business Administration

Blog: http://www.darden.edu/html/deansblog.aspx

Author of seven books and an expert in several areas of finance, including financial crises and mergers and acquisitions, Bruner has been widely quoted in the past three years. Major media seek him out for stories about the current financial crises. He often provides big-picture lessons and historical context, drawing on his recent book, "The Panic of 1907: Lessons Learned from the Market's Perfect Storm," which examines a financial crisis that bears remarkable similarity to today's turbulence. Among the lessons: "the current crisis overshadows previous crises in four key ways: complexity, inflexibility, speed and scale."

Recent quotes:

Commentary: A global fix for the next financial panicCNN / Oct. 29http://www.cnn.com/2008/POLITICS/10/29/bruner.global/index.html

Intervention Is Bold, but Has a Basis in HistoryNew York Times / Oct. 14http://www.nytimes.com/2008/10/14/business/economy/14nationalize.html

Bailouts, Then and NowNPR's "On Point" / Oct. 6http://www.onpointradio.org/shows/2008/10/bailouts-then-and-now/

The bailout, banking, the credit crunch

"¢ David C. SmithAssociate Professor of CommerceDirector, McIntire Center for Financial Innovation

Web site: http://commerce.virginia.edu/faculty_research/staff_directory/smith,dc.html

Formerly an economist at the Federal Reserve focused on international financial architecture, Smith studies corporate finance and banking, including bankruptcy, corporate governance, loan restrictions and renegotiations, and the impact of credit rationing on small business. Smith supports the recent public purchase of bank stock as part of the $700 billion bailout.

Recent quotes:

Treasury bids to free up lending with cash infusion to banksUSA Today / Oct. 15http://www.usatoday.com/money/industries/banking/2008-10-14-bank-plan-paulson_N.htm

The question now: Will bailout plan work?USA Today / Sept. 29http://www.usatoday.com/money/economy/2008-09-28-money-economy-bailout-deal_N.htm

"¢ Peter RodriguezAssociate Professor of Business AdministrationAssociate Dean for International RelationsDirector, Tayloe Murphy International Center

Web site: http://www.darden.virginia.edu/html/direc_detail.aspx?styleid=2&id=4377

Trained as an economist — having studied at Princeton under current Federal Reserve Chairman Ben Bernanke — Rodriguez focuses on international business, energy, trade and economic development, with an emphasis on corruption. Prior to his teaching career, he worked in the Global Energy Group at JP Morgan Chase. He has been widely quoted regarding the effects of Katrina on the economy, gasoline prices, the housing market and other economy-related issues in the national media.

Recent quotes:

Perhaps $700 billion is 'too many zeros'Richmond Times Dispatch / Oct. 2http://www.inrich.com/cva/ric/news.apx.-content-articles-RTD-2008-10-02-0149.html

Why U.S. job market has not plungedChristian Science Monitor / May 5http://www.csmonitor.com/2008/0505/p01s02-usec.html

Savings, thrift, consumption tax

"¢ Ronald WilcoxProfessor of Business Administration

Blog: http://usthrift.wordpress.com/

A former economist for the U.S. Securities and Exchange Commission, Wilcox often speaks to the media in connection with his recent (and timely) book, "Whatever Happened to Thrift: Why Americans Don't Save and What to Do about It." As he explains in his book and his blog [ http://usthrift.wordpress.com/], there are a number of measures that could make it easier for people to save, from helping the smallest companies offer 401(k) plans (and opt employees into them by default) to replacing the income tax with a consumption tax. America's debt addiction is partly a byproduct of American optimism, explains Wilcox, but it is exacerbating the current economic downturn.

Recent quotes:

A return to thriftWashington Post / Fortune Magazine / Oct. 21http://www.washingtonpost.com/wp-dyn/content/article/2008/10/20/AR2008102002643.html

Commentary: How To Save The Economy / It's simple — save your money.Forbes / Nov. 11http://www.forbes.com/opinions/2008/11/10/savings-taxes-economy-oped-cx_rw_1111wilcox.html

Financial markets, futures, trader behavior, credit default swaps

"¢ Robert WebbProfessor of Commerce

Web site: http://commerce.virginia.edu/faculty_research/staff_directory/Webb.html

Webb's expertise in financial markets is rooted in his years as a futures trader on the Chicago Mercantile Exchange, where he designed new types of futures contracts, and later served as a senior economist. As editor of the Journal of Futures Markets and author of "Trading Catalysts: How Events Move Markets and Create Trading Opportunities," he is a leading expert on the nuances of financial markets, trader behavior, and complex financial instruments like credit default swaps. He has worked for the Executive Office of the President, the Office of Management and Budget and the Commodity Futures Trading Commission. He commented recently that commodity index traders probably did not drive up oil prices this summer.

Recent quotes:

Credit Market Answer / Derivatives Fix EyedNew York Post / Oct. 8http://www.nypost.com/seven/10082008/business/credit_market_answer_132654.htm

Index Traders Cut Oil Positions This Year, CFTC SaysBloomberg / Sept. 11http://www.bloomberg.com/apps/news?pid=newsarchive&sid=atj4DMxanc5o

Regulation of financial markets

"¢ Paul G. MahoneyDean of the School of Law Distinguished Professor of Law

Web site: http://www.law.virginia.edu/lawweb/Faculty.nsf/FHPbI/2477

Mahoney's landmark 1997 study of the self-regulation of financial markets argued that privately run markets have a self-interest in safeguarding investors, beginning a shift in support among academics for financial market self-regulation. He teaches and researches securities regulation, law and economic development, corporate finance, financial derivatives and contracts. He previously practiced corporate law in New York City and clerked for U.S. Supreme Court Justice Thurgood Marshall. Mahoney is a member of the Council on Foreign Relations and has served as an associate editor of the Journal of Economic Perspectives and as a director of the American Law and Economics Association.

Recent quotes:

CSX vote delay — desperate gamble or shrewd move?Reuters / The Guardian (London) / June 26http://www.guardian.co.uk/business/feedarticle/7611882

Getting Business School Skills While in Law School U.S. News & World Report / Mar. 26http://www.usnews.com/articles/education/best-graduate-schools/2008/03/26/getting-business-school-skills-while-in-law-school.html

In the stocks / Shame Fills a Vacuum in China's Financial Law Enforcement Economist / Feb. 28http://www.economist.com/displayStory.cfm?story_id=10765975

Investment banking, hedge funds, private equity, corporate finance

"¢ William J. Wilhelm Jr.Professor of Commerce

Web site: http://commerce.virginia.edu/faculty_research/staff_directory/Wilhelm.html

An expert on financial markets and institutions, Wilhelm's most recent book is a history of investment banking: "Investment Banking: Institutions, Politics, and Law," which provides an economic rationale for the dominant role of investment banks in the capital markets. He comments frequently on hedge funds, boutique investment firms, and the future of investment banking.

Recent quotes:

The Nation: Those Other Guys on the StreetNew York Times / Sept. 28http://www.nytimes.com/2008/09/28/weekinreview/28sorkin.html

Wall Street model broken by credit crisisReuters / Sept. 15http://www.reuters.com/article/newsOne/idUSN1481719820080915?sp=true

"¢ Susan ChaplinskyProfessor of Business Administration Associate Dean for Faculty Scholarship

Web site: http://www.darden.virginia.edu/html/direc_detail.aspx?styleid=2&id=4109

Chaplinsky studies private equity firms and how they have come to control a much larger share of our economy in recent years. Her other areas of expertise include raising capital, corporate finance, employee stock ownership plans, investment banking and valuation.

Recent quotes:

Private equity in a market freezeNPR's Marketplace / Oct. 29 http://marketplace.publicradio.org/display/web/2008/10/29/private_equity

"¢ Kenneth EadesProfessor of Business Administration

Web site: http://www.darden.virginia.edu/html/direc_detail.aspx?styleid=2&id=4277

Eades' research focuses on corporate finance issues, including dividend policy, mergers and acquisitions, investments, defined benefit pensions and pricing of convertible securities. The author of more than 50 Darden cases, Eades has received both research and teaching awards and teaches a business class to U.Va. law students.

Recent quotes:

Wells Fargo tops Citigroup Wachovia bidRichmond Times Dispatch / Oct. 4http://www.inrich.com/cva/ric/news.apx.-content-articles-RTD-2008-10-04-0134.html

Interest rates, Federal Reserve, international capital flows

"¢ Francis Warnock Associate Professor of Business Administration

Web site: http://www.darden.virginia.edu/html/direc_detail.aspx?styleid=2&id=4366

Warnock developed his expertise in international capital flows as a senior economist at the Federal Reserve, following private sector work for Merrill Lynch in Vienna, Austria and as a commodity trader on Wall Street. He currently serves as a senior fellow at the Federal Reserve Bank of Dallas' Globalization & Monetary Policy Institute. He co-authored influential and often-cited research for the Federal Reserve finding that U.S. long-term interest rates would be 1 percentage point higher without demand from foreign governments and central banks.

Recent quotes:

Bernanke Push for Lower Rates Drives U.S. Yields UpBloomberg / Nov. 3http://www.bloomberg.com/apps/news?pid=20601087&sid=akUo9OCJA3PI&refer=home

B-Schools: Perspective on Financial CrisesBusinessWeek / Sept. 18http://www.businessweek.com/bschools/content/sep2008/bs20080918_202559.htm Mortgages — subprime, renegotiation, valuation, liability "¢ Richard F. DeMong Virginia Bankers Professor of Bank ManagementDirector, Center for Financial Services Studies

Web site: http://commerce.virginia.edu/faculty_research/staff_directory/DeMong.html

DeMong is an expert on mortgages (prime, subprime, etc.), bank investment strategies, equity valuation and financial management of private companies. Published papers include "Mortgage Pricing Is Based on Risk" and "Prepayment Fees Lead to Lower Interest Rates." As a free market advocate, in 2004 he testified before Congress against assignee liability laws, which would have allowed home mortgage borrowers to sue anyone holding paper on their loan, from the originators who sold it to them to the Wall Street investment bankers who ultimately funded it. Supporters contest that such laws would have put the brakes on subprime lending.

Recent quotes:

Politicians, lobbyists shielded financiers / Lack of liability laws fueled firms' avarice Seattle Post Intelligencer / Oct.10 http://seattlepi.nwsource.com/business/382707_mortgagecrisis09.html

State's banks on solid ground, official saysRoanoke Times / July 16http://www.roanoke.com/business/wb/169507 Tax law, tax issues

"¢ George YinDistinguished Professor of Law and Taxation

Web site: http://www.law.virginia.edu/lawweb/Faculty.nsf/FHPbI/4046

Yin comments routinely on tax issues related to the financial crisis, drawing on his experience as chief of staff for Congress's Joint Committee on Taxation, one of the most influential tax positions in the country, from 2003-05, after having previously worked for the Senate Finance Committee. He has been critical of recent closed-door regulation changes by Treasury Secretary Henry Paulson that let healthy banks buy weak ones and take big tax write-offs for the weak banks' losses. He offers even-handed, pragmatic analysis on the pros and cons of various tax reform proposals.

Recent quotes:

Editorial: Little-noticed tax change hands billions more to banksUSA Today / Nov. 14http://blogs.usatoday.com/oped/2008/11/our-view-on-the.html

Don't Expect Too Many Jobs From Tax ProposalsWall Street Journal blog / Oct. 28http://blogs.wsj.com/economics/2008/10/28/dont-expect-too-many-jobs-from-tax-proposals/

Crisis big picture, business law

"¢ George Geis Professor of Law

Web site: http://www.law.virginia.edu/lawweb/Faculty.nsf/PrFHPbW/ggeis Geis is an expert in business law whose research focuses on business alliances, corporate finance, contract theory, and mergers and acquisitions. He is a former management consultant with McKinsey & Company and has worked for law firms in New York and Los Angeles.

Geis' take on how the crisis is evolving: "Recent challenges in the U.S. turnaround plan reflect three stark facts: one, we have clearly moved beyond a liquidity crunch into real economic pain; two, no one knows the exact route back to solid ground; and three, the global nature of the problem is accelerating 'pass the plate' strategies as each country reacts to the policy choices of its neighbors."

Politics of the bailout, the global economy, and the U.S. auto industry

"¢ David LeblangJ. Wilson Newman Professor of Governance Professor of Politics

Web site: http://millercenter.org/about/staff/leblang

Leblang is a faculty associate in the Governing America in a Global Era program of U.Va.'s Miller Center of Public Affairs. A specialist in political economy, Leblang has served as a consultant to the International Monetary Fund, the Directorate of Finance and Economics of the European Commission, and the Department of Defense. He co-authored, "Democratic Politics and Financial Markets: Pricing Politics" (2006). He has written on the politics of economic growth, the determinants of exchange rate policy, the causes of currency crises and the link between elections and economic expectations.

Recent quotes:

Editorial: Reconsidering ownershipCharlottesville Daily Progress / Oct. 26http://www.dailyprogress.com/cdp/news/opinion/op_ed/article/reconsidering_ownership/30170/

"¢ Herman SchwartzProfessor of Politics

Schwartz specializes in the politics of the global economy, including detailed studies of various industries (automobiles, aircraft, semiconductors and biotech) in the U.S., other industrial countries and developing nations. His well-known book, "States vs. Markets: The Emergence of the Global Economy" (2000), was recently translated into Chinese. He has written a forthcoming book, "Subprime Nation: American Power, Global Capital and the Housing Bubble" (expected Aug. 2009). He discussed themes from that book at a U.Va. event in February. Event video at: http://millercenter.org/scripps/archive/colloquia/detail/3864.


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