Is the fact that different banks have different risk models problematic? Contrary to the Basel Committee and the European Banking Authority, this column argues that heterogeneity is a good thing. It leads to countercyclicality, and thereby reduces instances of procyclical price movements. Both the Basel Committee and the European Banking Authority have indicated that they [...] View the full post at: Towards a More Procyclical Financial System Related posts: The Financial System and Its Identifying Solutions China Sees Limited Impact from Financial Turmoil World Financial Markets Impose Short-Selling Ban