Milestone in the Development of Modern Financial Models

The history of financial development in the 20th and 21st centuries incorporates a progression of modeling innovations, advances, and setbacks. Second-line- of-defense model risk management practices and regulations have evolved in response to those events.

Finance has always required a mastery of numbers. Money and banking, even in its simplest form, required the development of abstract concepts to manipulate intangible claims: money (as a unit of denomination, store of value, and me…