In response to my last post, Zvi Bodie writes to suggest that I may be simply rephrasing a point that he and Robert Merton made in a series of papers some years ago (the seminal paper is here). I don’t think so, but the suggestion brings into the foreground the question of the relationship between the money view and the finance view. For some financial intermediaries (insurance companies) the finance view is arguably most of the story most of the time, but for others (banks) the money view is often the main part of the story.
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