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Can Output Losses Following International Financial Crises be Avoided?

Dooley, Michael P. - 2000

Recent financial crises in emerging markets have been followed by temporary but substantial losses in output. This paper explores the possibility that threats of such losses are the dominant incentive for repayment of international debt. In this environment private debtors and creditors have...

Persistent link: https://www.econbiz.de/10012471243

Capital Movements, Banking Insolvency, and Silent Runs in the Asian Financial Crisis

Kane, Edward J. - 2000

This paper supplies an agency-cost and contestable-markets perspective on the financial policies that triggered the Asian financial crisis. The agency-cost analysis hypothesizes that individual-country regulators knew that politically directed loans had made their banks insolvent, but...

Persistent link: https://www.econbiz.de/10012471262

Debt and Default in the 1930s : Causes and Consequences

Eichengreen, Barry J. - 1985

This paper analyzes the "debt crisis" of the 1930s to see what light this historical experience sheds on recent difficulties in international capital markets. We first consider patterns of overseas lending and borrowing in the 1920s and 1930s, comparing the performance of standard models of...

Persistent link: https://www.econbiz.de/10012477304

What Hinders Investment in the Aftermath of Financial Crises : Insolvent Firms or Illiquid Banks?

Kalemli-Ozcan, Sebnem - 2010

We quantify the effects of lending and balance sheet channels on corporate investment during large crises in emerging markets. The depreciated currency creates investment opportunities in the tradable sector but firms might be financially constrained due to: 1) a deterioration of their balance...

Persistent link: https://www.econbiz.de/10012462129

Leverage and Asset Bubbles : Averting Armageddon with Chapter 11?

Miller, Marcus - 2010

bankruptcy procedures for doing this fail to internalise the price effects of asset 'fire-sales' to pay down debts, however. We …

Persistent link: https://www.econbiz.de/10012462797

Optimal taxation in the presence of bailouts

Panageas, Stavros - 2009

The termination of a representative financial firm due to excessive leverage may lead to substantial bankruptcy costs …

Persistent link: https://www.econbiz.de/10012463244

Hedge Funds as Liquidity Providers : Evidence from the Lehman Bankruptcy

Aragon, George O. - 2009

Using the September 15, 2008 bankruptcy of Lehman Brothers as an exogenous shock to funding costs, we show that hedge … funds act as liquidity providers. Hedge funds using Lehman as prime broker could not trade after the bankruptcy, and these …-connected hedge funds in turn experienced greater declines in market liquidity following the bankruptcy than other stocks; and, the …

Persistent link: https://www.econbiz.de/10012463314

Bailouts, the Incentive to Manage Risk, and Financial Crises

Panageas, Stavros - 2009

A firm's termination leads to bankruptcy costs. This may create an incentive for outside stakeholders or the firm …'s debtholders to bail out the firm as bankruptcy looms. Because of this implicit guarantee, firm shareholders have an incentive to …

Persistent link: https://www.econbiz.de/10012463592

How the Subprime Crisis Went Global : Evidence from Bank Credit Default Swap Spreads

Eichengreen, Barry - 2009

How did the Subprime Crisis, a problem in a small corner of U.S. financial markets, affect the entire global banking system? To shed light on this question we use principal components analysis to identify common factors in the movement of banks' credit default swap spreads. We find that fortunes...

Persistent link: https://www.econbiz.de/10012463744

Wall Street's First Corporate Governance Crisis : The Panic of 1826

Hilt, Eric - 2009

In July of 1826, several prominent Wall Street firms abruptly went bankrupt, amid scandalous revelations of fraudulent financial practices by their management. Although mostly forgotten today, these events represented a watershed in the early development of the corporation laws and investor...

Persistent link: https://www.econbiz.de/10012463756