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A dialogue on the costs and benefits of automatic stays for derivatives and repurchase agreements
Duffie, Darrell; Skeel, David - 2012 - Last rev.: March 04, 2012
For nearly two years, the two of us have had a running discussion of the costs and benefits of automatic stays in bankruptcy for qualified financial contracts (QFCs) such as derivatives and repurchase agreements, particularly those held by systemically important major dealer banks. Under current...
Persistent link: https://www.econbiz.de/10009504439
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Corporate failure and the business cycle : measuring systematic risk
Ogneva, Maria; Piotroski, Joseph D.; Zakolyukina, … - 2016
In this paper, we use accounting fundamentals to measure systematic risk of distress. Our main testable prediction—that this risk increases with the probability of recessionary failure, P(R|F)—is based on a stylized model that guides our empirical analyses. We first apply the lasso method to...
Persistent link: https://www.econbiz.de/10011524470
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Earning volatility, capital structure decisions and financial distress by SEM
Ghasemzadeh, Morteza; Heydari, Mehdi; Mansourfar, Gholamreza - In: Emerging markets, finance & trade : a journal of the … 57 (2021) 9, pp. 2632-2650
Persistent link: https://www.econbiz.de/10012549936
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Cash holdings and credit risk
Acharya, Viral V.; Davydenko, Sergei A.; Strebulaev, Ilya A. - 2012
Intuition suggests that firms with higher cash holdings should be 'safer' and have lower credit spreads. Yet empirically, the correlation between cash and spreads is robustly positive. This puzzling finding can be explained by the precautionary motive for saving cash, which in our model causes...
Persistent link: https://www.econbiz.de/10010206259
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The bank as grim reaper : debt composition and bankruptcy thresholds
Carey, Mark S.; Gordy, Michael B. - 2016
We offer a model and evidence that private debtholders play a key role in setting the endogenous asset value threshold below which corporations declare bankruptcy. The model, in the spirit of Black and Cox (1976), implies that the recovery rate at emergence from bankruptcy on all of the firm's...
Persistent link: https://www.econbiz.de/10011578370
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Confronting the zombies : policies for productivity revival
Andrews, Dan; McGowan, Muge Adalet; Millot, Valentine - 2017
much scope to improve the design of insolvency regimes in order to reduce the barriers to restructuring of weak firms and … the personal costs associated with entrepreneurial failure. Insolvency regime reform can not only address the … markets. As the zombie firm problem may partly stem from bank forbearance, complementary reforms to insolvency regimes are …
Persistent link: https://www.econbiz.de/10011779088
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Chapter 6. Law and Finance After a Decade of Research
La Porta, Rafael; Lopez-de-Silanes, Florencio; … - 2013
In the last dozen years, economists have produced a considerable body of research suggesting that the historical origin of a country’s laws is highly correlated with a broad range of its legal rules and regulations, as well as with economic outcomes. Much of this research has dealt with rules...
Persistent link: https://www.econbiz.de/10014025558
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Creditor-on-Creditor Violence and Secured Debt Dynamics
Antill, Samuel; Wang, Neng; Jiang, Zhaoli - National Bureau of Economic Research - 2024
Secured lenders have recently demanded a new condition in distressed debt restructurings: competing secured lenders must lose priority. We model the implications of this "creditor-on-creditor violence" trend. In our dynamic model, secured lenders enjoy higher priority in default. However,...
Persistent link: https://www.econbiz.de/10015056182
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The effects of bankruptcy on the predictability of price formation processes on Warsaw's stock market
Fiedor, Paweł; Hołda, Artur - In: E-Finanse : finansowy kwartalnik internetowy 12 (2016) 1, pp. 32-42
In this study we investigate how bankruptcy affects the market behaviour of prices of stocks on Warsaw’s Stock Exchange. As the behaviour of prices can be seen in a myriad of ways, we investigate a particular aspect of this behaviour, namely the predictability of these price formation...
Persistent link: https://www.econbiz.de/10011539782
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Leverage and Asset Bubbles: Averting Armageddon with Chapter 11?
Miller, Marcus; Stiglitz, Joseph E - C.E.P.R. Discussion Papers - 2009
driving asset prices to ‘overshoot’ equilibrium when an asset bubble bursts - threatening widespread insolvency and what …
Persistent link: https://www.econbiz.de/10008528524