Financial crises extend far beyond Wall Street, former Secretary of the Treasury Tim Geithner told a crowd of 400 at the School of Management Wednesday.

What is more, Geithner said, policymakers have not gotten dramatically better at addressing the crises.

His lecture, which was delivered as part of a SOM course entitled “Global Financial Crisis” Geithner is co-teaching with the SOM Deputy Dean Andrew Metrick, focused on the common causes of financial crises. In particular, Geithner focused on the 2008 financial crisis, in which he played a critical role as president of the Federal Reserve Bank of New York.

“We came to that panic in the fall of ’08, even with the pretty formidable amount of talent around the table [we had] no knowledge [of crises],” he said.

After beginning his lecture by stressing the human consequences of financial crises, as well as policymakers’ inability to effectively address them, Geithner reprimanded financial regulators, including himself, for failing to recognize warning signs of the crisis brewing in the late 2000s and to properly deal with the crisis once it occurred.

Geithner then focused on the broader issue of why crises occur and on the nature of the 2008 Great Recession.

The period of relative calm in the markets that stretched from the Great Depression through the early 21st century created an illusion of perpetual stability amongst financial actors, politicians and the public at large, he said.

This general sentiment of calm, Geithner said, enabled the proliferation of fragile and risk-prone businesses such as hedge funds and holding companies.

Geithner further noted that these developments in the financial markets in the years before the crisis limited the Federal Reserve and Treasury Department’s abilities to contain risk within one part of the economy.

The policymakers in charge of responding to the crisis made some mistakes in responding to the 2008 financial crisis, Geithner said, further admitting that his own actions were not beyond criticism. Specifically, he said he and other regulators failed to force more capital into the far-reaching financial system to anticipate the consequences of what began, in 2007, with a collapse in home prices.

“We didn’t force the system to run with a big enough set of shock absorbers,” he said.

But Geithner also noted that policymakers, in attempting to respond to the crisis, were hindered by legal constraints.

“This was not about the failure of authority,” he said. “It was about the absence of authority. It was about the laws.”

Geithner, who along with then-Secretary of the Treasury Henry Paulson and then-Federal Reserve Chairman Ben Bernanke coordinated unprecedented measures to prevent a complete collapse of the financial markets in September 2008, said that the constraints prevented policymakers from controlling financial risk.

In the questioning portion of the talk, Geithner touched on, among other topics, the ability of regulators to predict future crises. He said he was most concerned about the limitations placed on the “firefighting authority” — the ability of regulators to respond to the crisis once it has begun.

Benjamin Rubenstein ARC ’17 said he agreed with Geithner’s claim that, although the Federal Reserve’s power has been curbed, crisis prevention measures have still generally improved since 2008.

“It’s a bittersweet response — he feels that the powers the Fed has aren’t quite as large, that these shadow banks need to be watched. It’s a net gain, but there’s a worry that authority in the system has diminished,” he said.

The former secretary of the treasury was introduced by economics professor Robert Shiller. He will speak at Yale twice more this term — on the United States’ response to the crisis and the prospect of future crises.

Shiller praised Geithner’s performance during and after the crisis. “As Treasury Secretary [in] very difficult times, [he] has done immeasurable benefit to this country,” he said.

Geithner’s memoir, “Stress Test,” was released last May.