Writers Den

Unit MT217

Annuities

Systematic risk evaluates the probability and extent of
negative consequences to the larger body. For example, the government has a
record of intervening in the event of a probable bank failure; the government’s
larger concern is the negative impact on bank customers. Some call this a
government bail-out.

Discuss the effect on stock market investor confidence
should bank customers, individuals and businesses alike, lose access to savings
and undergo a loss of future purchasing power due to a bank failure.