Necessarily, any insurance arrangement is contingent, so it may share some of the features of Contingent Convertible bonds. However, if all banks were required to contribute to a common insurance pool, the risk coverage would be spread more broadly than if the scheme is limited to the “too-big-to-fail” banks.
Available economic data for the current quarter show a sharp drop in output and an equally sharp rise in unemployment. By these measures and many others, the scope and speed of this downturn are without modern precedent and are significantly worse than any recession since World War II.