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

2012 ◽  
Author(s):  
Atif Mian ◽  
Amir Sufi ◽  
Francesco Trebbi
Keyword(s):  
Financial Crises ◽  
Debt Overhang ◽  
Political Constraints

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)

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Historical Document ◽  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Geithner's memoir of the financial crisis of 2007–08—Stress Test: Reflections on Financial Crises—is an important historical document offering details of how policies were formed and implemented during the crisis, showing the political constraints, and offering lessons for future crises.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)

Antitrust Law Amidst Financial Crises

2009 ◽  
Author(s):  
Ioannis Kokkoris ◽  
Rodrigo Olivares-Caminal
Keyword(s):  
Financial Crises ◽  
Antitrust Law

Basel Capital Adequacy Ratio Standard in The Light of Islamic Law Perspective

2016 ◽  
Vol 1 ◽  
pp. 308-317
Author(s):  
Adi Rahmanur Ibnu
Keyword(s):  
Financial Crises ◽  
Global Economy ◽  
Banking Sector ◽  
Islamic Law ◽  
Capital Requirements ◽  
Capital Adequacy ◽  
Minimum Capital ◽  
Capital Adequacy Ratio ◽  
Global Banking ◽  
Banking Development

Bank is one of the most important pillars of economy activities. However, banking sector has a real potential crisis threat. Alongside with the steady current global banking development, financial crises that have happened clearly affected global economy. Based on that situation, BIS (Bank for International Settlement) – an international financial standard setting organization, realizes the urgency to establishan international financial standard and supervision to anticipate future potential financial crises. This research aims to identify how Capital Adequacy Ratio Standard in Basel Capital Accord (II) based on Islamic law perspective. The research is conducted by analyzing Basel Capital Accord published by BIS. The research uses library research method to find out the aimed result. The focus is on the 1st pillar of Basel II publication that is Minimum Capital Requirements (CAR) policy. CAR, as an Islamic economics policy, will be analyzed using falāḥ approach. Falāḥ is an Islamic economics objective that consists of happiness, success, accomplishment or good luck concept. The earthly dimension of falāḥ has some parameters that can be used to analyze Islamic economics policy. Additionally, the Islamic fiqh maxim takes part in analyzing the policy. The maṣlaḥat concept in fiqh maxim approach shares aim with falāḥ concept in the sense that all of sharia law aims for success, happiness, eternal survival etc. The maṣlaḥat can be accomplished by extinguishing mafsadat or seizing maṣlaḥat. The maṣlaḥat aspect is essential to determine the compatibility Basel Capital Accord with jurisprudential maxim i.e harm must be dispelled (al-dharāru yuzāl). The conclusion results are, 1) Basel Capital Accord focuses on macro-prudential aspect in order to anticipate potential financial crises, 2) beneficial/interest (maṣlaḥat) aspects of the hereafter, cooperation principle, justice, fairness and the prohibition of exploitation are not the core value of Basel Capital Accord frame work, thus 3) the achievement of maslahat as intended by sharia i.e. jurisprudential maxim are not convincing. Therefore, 4) Basel Capital Accord as a regulation basis is not in line with jurisprudential maxim i.e harm must be dispelled (al-dharāru yuzāl).

Leverage Change, Debt Overhang, and Stock Prices

CFA Digest ◽  
2011 ◽  
Vol 41 (3) ◽  
pp. 19-21
Author(s):  
Chenchuramaiah T. Bathala
Keyword(s):  
Stock Prices ◽  
Debt Overhang
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