Such requirements would diminish the risk of the shortfalls and hoarding that could fuel a credit market meltdown. Policymakers might additionally put in place policies to discourage overreliance on short-term debt among investors more broadly through, for example, regulations on repo haircuts. To address unsustainable real estate price run-ups, some countries have chosen to cap maximum loan-to-value ratios on home loans.
Such an approach deserves serious consideration. My expectation is that policies such as these will restrict dangerous pro-cyclical movements in debt and leverage, diminish the extent of maturity mismatches and the potential for runs, and discourage unsustainable asset price appreciation.