Anat Admati speaks at a World Economic Forum session in Davos, Switzerland. (Photo: Flickr/Jolanda Flubacher)

She's changing how the world thinks about banking reform

Israeli economist and Stanford professor Anat Admati listed among Time's 100 most influential.

The links between the banking industry and recent financial crises are mystifying to many, but not to Stanford University business professor Anat Admati. Her research on structured banking systems and how to make them safer earned her a place on Time magazine's list of "100 Most Influential People."

On May 10, she gave a TED talk at Stanford about reforming the banking industry.

Admati earned a bachelor's degree from the Hebrew University in Jerusalem and her master's and doctorate degrees from Yale University.  In her book  "The Banker’s New Clothes," she and a co-author plainly explain how the 2008 financial crisis differed from its immediate predecessor, the bursting of the technology bubble in 2000. In contrast to those high-tech companies, banks had over-leveraged their assets – funded not by shareholder stock but by short-term debt.

Earlier this month, U.S. financial regulators announced they will require eight of the largest banks to gather another $68 billion, hopefully ensuring that whatever happened last time won’t happen again. 

In a column she wrote for The New York Times, Admati said the only way to prevent another crisis is "to make banks rely much more on equity, and much less on borrowing."

Admati also discussed her book in a video:

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