PUBLISHED:March 13, 2009

The Duke Project: Law students piece together solutions to the global financial crisis

March 13, 2009 — “The Duke Project” continues its analysis of the global financial crisis March 18 with a panel discussion exploring the federal government’s efforts to rescue the country from its economic freefall.

The free, public event begins at 6:15 p.m. in Room 3041 of Duke Law School, located at the corner of Science Drive and Towerview Road on Duke’s West Campus. Parking is available at the Bryan Center.

The Duke Project is a class project with ambitious real-world goals. Over a nine-week period, students in Professor Bill Brown’s class on “Legal, Accounting, and Business Responses to the Subprime Crisis” are publicly unveiling their solutions to specific aspects of the global financial meltdown.

On March 18, Jess Cheney ’10, Aaron Harmon ’09, Ryan Martin ’09, and LLM candidate Yen-Chia Chen, will present their paper, “Bailout Fallout.” They will be joined in a subsequent discussion by Professor Larry Ribstein, the Mildred Van Voorhis Jones Chair at the University of Illinois College of Law, Professor John Coleman of Duke University’s Fuqua School of Business, and Professor Edward Tower of Duke University’s Department of Economics.

“The federal government’s response to the financial crisis has been varied and far-reaching, and has included brokering the Bear Stearns sale, placing Fannie Mae and Freddie Mac into conservatorship, and pouring $700 billion into the Temporary Asset Relieve Program,” Harmon notes. “These and other measures have produced plenty of debate in legal and economic circles. We will be looking at whether they were appropriate, whether they will work, and what lasting effects they might have on society.”

Throughout the fall semester of his yearlong class, Brown and his students undertook a forensic analysis of the origins and contagion of the financial crisis. Working in teams, students are developing nine papers that propose approaches to specific domestic and international challenges raised by the crisis, such as economic stimulus, moral hazard, consumer debt, accounting rules, and the role of rating agencies. Each of the papers will form one chapter of a book to be published at the end of the semester.

Brown is a 1980 Duke Law graduate who joined the faculty after serving in leadership positions at Goldman Sachs & Co, AIG, and Morgan Stanley where he specialized in currency and fixed-income markets. He says his students have approached key economic challenges with creativity and insight. “This could be the most important set of issues they encounter in their lifetimes — it certainly is the most important issue for the next decade,” he says. “They really have wrapped their arms around this and understand it in ways that many top policymakers don’t.”