Macroeconomic Determinants of Sovereign Bond Yield Spreads in
... The creation of common goals for different countries, like in the Maastricht criteria or in the newly-established Macroeconomic Imbalance Procedure, may not be the most efficient way to anticipate sovereign crisis in case that the relationship between macroeconomic fundamentals and spreads is not c ...
... The creation of common goals for different countries, like in the Maastricht criteria or in the newly-established Macroeconomic Imbalance Procedure, may not be the most efficient way to anticipate sovereign crisis in case that the relationship between macroeconomic fundamentals and spreads is not c ...
NBER WORKING PAPER SERIES HOUSEHOLD LEVERAGING AND DELEVERAGING Alejandro Justiniano Giorgio E. Primiceri
... The evolution of U.S. households’ debt since the turn of the XXI century has been remarkable. As shown in figure 1.1, the ratio of mortgage debt to GDP rose by about 30 percentage points between 2000 and the beginning of the financial crisis, three times more than in the previous episode of credit e ...
... The evolution of U.S. households’ debt since the turn of the XXI century has been remarkable. As shown in figure 1.1, the ratio of mortgage debt to GDP rose by about 30 percentage points between 2000 and the beginning of the financial crisis, three times more than in the previous episode of credit e ...
EUROPEAN COMMISSION Brussels, 22.2.2017 SWD(2017) 76 final
... Improving economic conditions and low interest rates are expected to support credit demand. Combined with the improving quality of banks' assets, this is set to result in mildly positive net credit flows. However, the nonperforming loans ratio remains high in comparison to other Member States. The n ...
... Improving economic conditions and low interest rates are expected to support credit demand. Combined with the improving quality of banks' assets, this is set to result in mildly positive net credit flows. However, the nonperforming loans ratio remains high in comparison to other Member States. The n ...
Count the Limbs: Designing Robust Aggregation Clauses in
... lending ignored the fact that Mexico’s vulnerability stemmed not from its foreign law bonds, but from dollar-indexed domestic law tesobonos, which might have been restructured unilaterally. The next round of bailouts responded to the crisis in Asia, with roots in cross-border interbank and corporate ...
... lending ignored the fact that Mexico’s vulnerability stemmed not from its foreign law bonds, but from dollar-indexed domestic law tesobonos, which might have been restructured unilaterally. The next round of bailouts responded to the crisis in Asia, with roots in cross-border interbank and corporate ...
Fundamentals of Corporate Finance, 2/e
... The Cost of Debt o KEY CONCEPTS FOR ESTIMATING THE COST OF DEBT • Interest rate (or historical interest rate determined when the debt was issued) that the firm is paying on its outstanding debt does not necessarily reflect its current cost of debt. • Current cost of long-term debt is the appropriat ...
... The Cost of Debt o KEY CONCEPTS FOR ESTIMATING THE COST OF DEBT • Interest rate (or historical interest rate determined when the debt was issued) that the firm is paying on its outstanding debt does not necessarily reflect its current cost of debt. • Current cost of long-term debt is the appropriat ...
Volume 74 No. 4, December 2011 Contents
... Zealanders is consumed in a typical year (about threequarters of that through goods and services purchased by households directly, and around one quarter of it delivered or undertaken by central and local governments).1 ...
... Zealanders is consumed in a typical year (about threequarters of that through goods and services purchased by households directly, and around one quarter of it delivered or undertaken by central and local governments).1 ...
NBER WORKING PAPER SERIES SOME ESTIMATES FOR OECD COUNTRIES
... We examine the effects of Þscal policy on interest rates in a broad panel of 16 OECD countries covering a maximum time span from 1960 to 2002. The results indicate statistically and economically signiÞcant effects of Þscal imbalances on long-term interest rates. In our preferred speciÞcation, a one pe ...
... We examine the effects of Þscal policy on interest rates in a broad panel of 16 OECD countries covering a maximum time span from 1960 to 2002. The results indicate statistically and economically signiÞcant effects of Þscal imbalances on long-term interest rates. In our preferred speciÞcation, a one pe ...
DOC - Europa.eu
... In what circumstances can Member States suspend the restrictions on uncovered short selling of sovereign debt? The Short Selling Regulation sets out certain restrictions on uncovered short sales of sovereign debt, in order to reduce the risks of settlement failure. To enter a short sale, an investo ...
... In what circumstances can Member States suspend the restrictions on uncovered short selling of sovereign debt? The Short Selling Regulation sets out certain restrictions on uncovered short sales of sovereign debt, in order to reduce the risks of settlement failure. To enter a short sale, an investo ...
Filippo Brutti Essays on Sovereign Debt Crises and Macroeconomic Volatility
... often predicted banking crises in a wide sample of emerging economies.5 The model builds on two natural assumptions for emerging markets. First, public debt represents a source of liquidity for the private sector. More specifically, firms save in government bonds (either directly or indirectly throu ...
... often predicted banking crises in a wide sample of emerging economies.5 The model builds on two natural assumptions for emerging markets. First, public debt represents a source of liquidity for the private sector. More specifically, firms save in government bonds (either directly or indirectly throu ...
Document
... low-income households particularly financially vulnerable to economic shocks. For these households, an adverse shock to labour income or to interest payments is more likely to lead to an unsustainable debt burden and economic distress. ...
... low-income households particularly financially vulnerable to economic shocks. For these households, an adverse shock to labour income or to interest payments is more likely to lead to an unsustainable debt burden and economic distress. ...
FINALHill Rebuttal
... concluded that leverage will increase a firm’s value— because interest on debt is a tax-deductible expense, more of a leveraged firm’s operating income flows through to investors, hence the value of the firm is higher.” (Brigham, ...
... concluded that leverage will increase a firm’s value— because interest on debt is a tax-deductible expense, more of a leveraged firm’s operating income flows through to investors, hence the value of the firm is higher.” (Brigham, ...
The determinants of government yield spreads in the euro area
... Greece, Ireland and Portugal. Since July 2011, other non-core countries, such as Spain and Italy, have recorded a strong increase in bond yields, while core countries, such as Germany, have benefited from a flight-to-quality effect. Overall, as the crisis developed, the observed pattern of the sprea ...
... Greece, Ireland and Portugal. Since July 2011, other non-core countries, such as Spain and Italy, have recorded a strong increase in bond yields, while core countries, such as Germany, have benefited from a flight-to-quality effect. Overall, as the crisis developed, the observed pattern of the sprea ...
paper - Stanford Institute for Theoretical Economics
... longer be restored by raising taxes or by eroding the real value of debt by creating inflation. In such situations, the government will have no other choice other than defaulting on its debt. We will refer to such a scenario as a fiscal default. Episodes of fiscal stress arise in our model because w ...
... longer be restored by raising taxes or by eroding the real value of debt by creating inflation. In such situations, the government will have no other choice other than defaulting on its debt. We will refer to such a scenario as a fiscal default. Episodes of fiscal stress arise in our model because w ...
Public Debt Structure and Dynamics in the Czech Republic
... Sargent and Wallace (see Sachs 1993). They pointed out, that debt financing in the long run may be inflationary. The argument is as follows: if a government builds up an excessive debt burden, that becomes too large to finance through taxes or more borrowing, the n the only way for the government to ...
... Sargent and Wallace (see Sachs 1993). They pointed out, that debt financing in the long run may be inflationary. The argument is as follows: if a government builds up an excessive debt burden, that becomes too large to finance through taxes or more borrowing, the n the only way for the government to ...
The Marginal Cost of Funds from Public Sector Borrowing
... The formula for the MCF from debt financing has two components. One is the inverse of the elasticity of the present value of the government’s net revenue stream (PVNR) with respect to the tax rate. The lower the elasticity of the PVNR, the greater the distortionary effect of a tax increase, and the ...
... The formula for the MCF from debt financing has two components. One is the inverse of the elasticity of the present value of the government’s net revenue stream (PVNR) with respect to the tax rate. The lower the elasticity of the PVNR, the greater the distortionary effect of a tax increase, and the ...
COUNTRY RISK - Semantic Scholar
... would frame the most pessimistic scenario. It is also possible to present arguments in favor of analyzing the role of public expenditures, the tax structure, or the fiscal responsibility of the Federal Government and the provinces separately. However, our hypothesis is that these are, from the point ...
... would frame the most pessimistic scenario. It is also possible to present arguments in favor of analyzing the role of public expenditures, the tax structure, or the fiscal responsibility of the Federal Government and the provinces separately. However, our hypothesis is that these are, from the point ...
FRBSF L CONOMIC
... Following a 20-year decline, the U.S. personal saving rate bottomed out at around 1% in the third quarter of 2005. Since then, the rate has been trending upward, reaching around 6% in the third quarter of 2010. The era of declining saving rates coincided with a period of expanding credit availabilit ...
... Following a 20-year decline, the U.S. personal saving rate bottomed out at around 1% in the third quarter of 2005. Since then, the rate has been trending upward, reaching around 6% in the third quarter of 2010. The era of declining saving rates coincided with a period of expanding credit availabilit ...
Foreign Investor Flows and Sovereign Bond Yields in Advanced Economies 27 WP/14/
... invested in U.S. Treasury securities (36 percent in 2010), and foreign official holdings of U.S. Treasury securities increased from $400 billion in 1994 to $3 trillion in 2010, suppressing longterm sovereign bond yields in the U.S. (Beltran and others, 2012). Motivated by the above arguments, Warnoc ...
... invested in U.S. Treasury securities (36 percent in 2010), and foreign official holdings of U.S. Treasury securities increased from $400 billion in 1994 to $3 trillion in 2010, suppressing longterm sovereign bond yields in the U.S. (Beltran and others, 2012). Motivated by the above arguments, Warnoc ...
The Euro`s Three Crises
... In this paper I describe the three crises affecting the euro area and their interrelationships, with a particular emphasis on how the growth and competitiveness challenges may undermine any efforts that focus exclusively on the liquidity concerns of banks and sovereigns. The lack of the usual tools ...
... In this paper I describe the three crises affecting the euro area and their interrelationships, with a particular emphasis on how the growth and competitiveness challenges may undermine any efforts that focus exclusively on the liquidity concerns of banks and sovereigns. The lack of the usual tools ...
Optimal Time-Consistent Monetary, Fiscal and Debt Maturity Policy ∗ Eric M. Leeper
... consumption and eliminate tax and other distortions (the so-called ‘war chest’ level). Secondly, starting from levels of debt consistent with currently observed debt to GDP ratios, the optimal time-consistent policy will gradually reduce that debt, but with large increases in inflation and radical c ...
... consumption and eliminate tax and other distortions (the so-called ‘war chest’ level). Secondly, starting from levels of debt consistent with currently observed debt to GDP ratios, the optimal time-consistent policy will gradually reduce that debt, but with large increases in inflation and radical c ...
Effect of Leverage on Performance of Non
... free cash free theory, Firms with high liquidity may have high debt because of their ability to meet short-term liabilities which means a positive relationship between liquidity and debt level. Jensen and Meckling (1976) argued that managerial incentives to allocate the firm’s resources to their pri ...
... free cash free theory, Firms with high liquidity may have high debt because of their ability to meet short-term liabilities which means a positive relationship between liquidity and debt level. Jensen and Meckling (1976) argued that managerial incentives to allocate the firm’s resources to their pri ...
Chapter 1
... Question 1: Do I Have Enough Liquidity to Meet Emergencies? Month’s Living Expenses Covered Ratio = monetary assets ...
... Question 1: Do I Have Enough Liquidity to Meet Emergencies? Month’s Living Expenses Covered Ratio = monetary assets ...
Firm Value
... This happens because, as the firm borrows more, some of the risk is transferred from the shareholders to the bondholders. copyright © 2003 McGraw Hill Ryerson Limited ...
... This happens because, as the firm borrows more, some of the risk is transferred from the shareholders to the bondholders. copyright © 2003 McGraw Hill Ryerson Limited ...
12. Misunderstanding the Great Depression and the Great
... the saver. Therefore, unless borrowers and savers have very different propensities to consume, this transfer should have no impact on aggregate demand. The contrast with the theoretical case that Marx, Schumpeter, Keynes and Minsky made about debt and aggregate demand (see pages 228-230) could not b ...
... the saver. Therefore, unless borrowers and savers have very different propensities to consume, this transfer should have no impact on aggregate demand. The contrast with the theoretical case that Marx, Schumpeter, Keynes and Minsky made about debt and aggregate demand (see pages 228-230) could not b ...
Government debt
Government debt (also known as public debt, national debt and sovereign debt) is the debt owed by a central government. (In federal states, ""government debt"" may also refer to the debt of a state or provincial, municipal or local government.) By contrast, the annual ""government deficit"" refers to the difference between government receipts and spending in a single year, that is, the increase of debt over a particular year.Government debt is one method of financing government operations, but it is not the only method. Governments can also create money to monetize their debts, thereby removing the need to pay interest. But this practice simply reduces government interest costs rather than truly canceling government debt, and can result in hyperinflation if used unsparingly.Governments usually borrow by issuing securities, government bonds and bills. Less creditworthy countries sometimes borrow directly from a supranational organization (e.g. the World Bank) or international financial institutions.As the government draws its income from much of the population, government debt is an indirect debt of the taxpayers. Government debt can be categorized as internal debt (owed to lenders within the country) and external debt (owed to foreign lenders). Another common division of government debt is by duration until repayment is due. Short term debt is generally considered to be for one year or less, long term is for more than ten years. Medium term debt falls between these two boundaries. A broader definition of government debt may consider all government liabilities, including future pension payments and payments for goods and services the government has contracted but not yet paid.