scholarly journals Resolving Debt Overhang: Political Constraints in the Aftermath of Financial Crises

2014 ◽  
Vol 6 (2) ◽  
pp. 1-28 ◽  
Author(s):  
Atif Mian ◽  
Amir Sufi ◽  
Francesco Trebbi
Keyword(s):  
Financial Crisis ◽  
Financial Crises ◽  
Strong Support ◽  
Financial Reform ◽  
Financial Reforms ◽  
Debt Overhang ◽  
Large Sample ◽  
Political Constraints ◽  
Clear Cut ◽  
The Us

Countries become more politically polarized and fractionalized following financial crises, reducing the likelihood of major financial reforms precisely when they might have especially large benefits. The evidence from a large sample of countries provides strong support for the hypotheses that following a financial crisis, voters become more ideologically extreme and ruling coalitions become weaker, independently of whether they were initially in power. The evidence that increased polarization and weaker governments reduce the chances of financial reform and that financial crises lead to legislative gridlock and anemic reform is less clear-cut. The US debt overhang resolution is discussed as an illustration. (JEL D72, E32, E44, G01, H63)

Prospects for the US economy in 2016

2015 ◽  
Keyword(s):  
Financial Crisis ◽  
Labour Market ◽  
Federal Reserve ◽  
Private Consumption ◽  
Full Employment ◽  
Emerging Countries ◽  
Content Type ◽  
Debt Overhang ◽  
Us Economy ◽  
The Us

Subject Prospects for the US economy in 2016. Significance The economy is close to full employment and a buoyant labour market should boost private consumption in 2016, offsetting some of the weakness in the industrial and trade sectors. Federal Reserve (Fed) officials have highlighted the external headwinds confronting the US economy from slowing growth in emerging countries and a continued debt overhang from the financial crisis.

Haunted houses: Gender and property television after the financial crisis

2017 ◽  
Vol 20 (5) ◽  
pp. 483-489 ◽  
Author(s):  
Jean Bruce ◽  
Zoë Druick
Keyword(s):  
Financial Crisis ◽  
Financial Crises ◽  
Special Issue ◽  
The Us ◽  
The Uk ◽  
Haunted Houses

This special issue includes six essays that consider the gendered dimensions of property television in the UK, Canada and the US as they have emerged since the financial crises of 2008.

scholarly journals The costs of responsibility for the political establishment of the Eurozone (1999–2015)

2018 ◽  
Vol 26 (3) ◽  
pp. 317-333 ◽  
Author(s):  
Sonia Alonso ◽  
Rubén Ruiz-Rufino
Keyword(s):  
Panel Data ◽  
Financial Crisis ◽  
Financial Crises ◽  
Global Financial Crisis ◽  
Strong Support ◽  
The Political ◽  
Data Set ◽  
Asymmetric Impact ◽  
Left And Right ◽  
The One

The objective of this article is to analyse the costs of responsible governance on the national political establishment of the Eurozone in the aftermath of the 2008 global financial crisis. Our analysis tests two main hypotheses. First, we argue that financial crises like the one unleashed by the global financial meltdown of 2008 have an asymmetric impact on the electoral records of establishment parties depending on whether the countries affected by the financial crisis were financially intervened in or not. Our second hypothesis states that externally imposed austerity affects Left and Right national establishment parties differently. By choosing to act responsibly, that is, assuming the conditions of the intervention, the establishment Left pays a much larger electoral price than the one paid by the establishment Right under the same circumstances. To test our argument, we use a panel data set of 12 countries from the Eurozone in the period between 1999 (stage III of the monetary union) and 2015 that contains 54 country-election-year observations. Our findings show strong support for our two hypotheses.

scholarly journals THE FINANCIAL CRISIS AND THE DOLLAR HEGEMONY

2012 ◽  
Vol 1 (1) ◽  
pp. 125-140
Author(s):  
Marcelo Milan
Keyword(s):  
Financial Crisis ◽  
Financial Crises ◽  
World Economy ◽  
International Reserve ◽  
Us Economy ◽  
The Us ◽  
The World ◽  
Us Dollar

This paper discusses the US dollar hegemony in the world economy. The discussion is carried out in three steps. First, the paper analyses the evolution of the US dollar in the world economy, emphasizing its resilience in the context of frequent financial crises. Second, the work discusses and compares the perspectives that trust the US dollar’s continuing role as an international reserve to those that assume a likely decline of both the dollar and the US economy after the 2007 financial crash. Finally, the article seeks to raise a few potential consequences of the continuing hegemony or declining of the dollar for the peripheral countries.

Stress for Success: A Review of Timothy Geithner's Financial Crisis Memoir

2015 ◽  
Vol 53 (4) ◽  
pp. 975-995 ◽  
Author(s):  
Gary Gorton
Keyword(s):  
Financial Crisis ◽  
Central Bank ◽  
Financial Crises ◽  
Stress Test ◽  
High Rate ◽  
The Political ◽  
Historical Document ◽  
Stress Tests ◽  
Political Constraints

Timothy Geithner's memoir of the financial crisis of 2007–08—Stress Test: Reflections on Financial Crises—is an important historical document offering details of how policies were formed and implemented during the crisis, showing the political constraints, and offering lessons for future crises. Walter Bagehot's classic rule for fighting crises— that the central bank should lend against good collateral at a high rate—is passive and incomplete. Geithner argues for the use of overwhelming force to reestablish confidence. Also, although the Federal Reserve's new crisis lending programs needed to be anonymous so as not to reveal weak banks' identities—“stigma”—the stress tests during the crisis did reveal information that may have been useful in reestablishing confidence. (JEL B31, E44, E63, G01, G21, G28)

scholarly journals FACTORS INFLUENCING INDIVIDUALS’ DECISION-MAKING AND CAUSING FINANCIAL CRISIS

2020 ◽  
Vol 21 (4) ◽  
pp. 1149-1164 ◽  
Author(s):  
Daiva Jurevičienė ◽  
Viktorija Skvarciany ◽  
Austė Lagunavičiūtė
Keyword(s):  
Financial Crisis ◽  
Financial Crises ◽  
Evaluation Method ◽  
Economic Expansion ◽  
Financial Decisions ◽  
Economic Decisions ◽  
The Us ◽  
Expert Evaluation Method ◽  
Second Period ◽  
Made In

It is essential to look at financial crises from both theoretical and practical aspects, as this is an old and recurring phenomenon. However, it is still unknown how to manage their formation. The article aims at assessing the influence of individuals’ financial decisions on financial crisis formation. The interface between economic decisions made by individuals and financial crises is assessed using expert evaluation method. The multi-criteria estimation performed using the TOPSIS method to evaluate when individuals make the most irrational decisions. Moreover, finally, economic decisions rationality index is concluded, evaluating when individuals make ridiculous decisions. The rationality index of economic decisions measures the number of irrational decisions during the economic expansion. Economic decisions rationality index divided into three groups: economic factors, financial sector and psychological factors. Assessment of the irrational decisions made during the economic expansion demonstrates that during the first period (2001–2006) the least irrational decisions were made in 2001 and the most in 2004; while during the second period (2010–2017), the least irrational decisions were made in 2011 and the most in 2015. The limitation of the research is that the data is accessible only for the US; hence, the results could differ in other countries.

The Diplomacy of the Financial Crisis in Context

2011 ◽  
Vol 6 (1-2) ◽  
pp. 187-201 ◽  
Author(s):  
Nicholas Bayne
Keyword(s):  
Decision Making ◽  
Financial Crisis ◽  
Private Sector ◽  
Emerging Markets ◽  
Financial Crises ◽  
Financial Stability ◽  
Regulatory Capture ◽  
Financial Reforms ◽  
Economic Diplomacy ◽  
Main Culprit

AbstractUntil the 1980s, financial crises were caused by governments. But thereafter the private sector became the main culprit. The reforms introduced after the Asian crisis of the late 1990s were not properly implemented. Responsibility for financial stability became fragmented and the normal practices of economic diplomacy were abandoned. The crisis of 2007 thus caught governments unawares and obliged them to adopt extreme measures to avoid catastrophe. The decision-making that was associated with these measures gave more power to emerging markets through the G20. It ended the fragmentation of authority and achieved reasonable consistency of national, European and international financial reforms. It introduced stringent new rules in place of regulatory capture. But this progress was fragile: G7 members still tried to control the G20; the new reforms depended on national enforcement; and governments still needed too much from the banks to be able to discipline them completely. This crisis might be over, but it has left the seeds of the next one.

GLOBAL FINANCIAL CRISIS: THE BUBBLE EFFECT IN INDONESIA

2018 ◽  
pp. 27-33
Author(s):  
Mohammad Benny Alexandri ◽  
Raeny Dwisanti
Keyword(s):  
Financial Crisis ◽  
Stock Price ◽  
Price Index ◽  
Global Financial Crisis ◽  
Price Ratio ◽  
Sharp Decline ◽  
Book Value ◽  
The Us ◽  
Investment Opportunities ◽  
Us Financial Crisis

US and Indonesia stock markets are entering record heights without being offset by economic growthand profitability growth of their traded companies. There are several indicators for the stock marketbubble: (1) Price Ratio (Ear Ratio); (2) Price Ratio / Book (PB Ratio), the latter comparing thenominal price of one share at a market with the book value (the value of company's assets). Thecurrent PB ratio of the composite stock price index being 3.3 means that for each shares the assetvalue of which is 1 IDR, the stock would be worth 3.3 IDR. This is one of the most expensive price in the world today. Based on the above, for Indonesian stock market sharp decline is just a matter of time and waiting. This decline will be much sharper if triggered by the US financial crisis. We can also also see a bubble emerging from increasingly irrational investment attitudes. Currently, in addition to high prices for stocks and bonds, investors have started looking at investment opportunities in digital currencies. This research tries to know the potential of financial crisis and itseffect for the financial market in Indonesia. 

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