Showing 1 - 10 of 706
Banks are optimally opaque institutions. They produce debt for use as a transaction medium (bank money), which requires … that information about the backing assets - loans - not be revealed, so that bank money does not fluctuate in value …-insensitive assets. For the economy as a whole, firms endogenously separate into bank finance and capital market/stock market finance …
Persistent link: https://www.econbiz.de/10010969202
We use a quantitative equilibrium model with houses, collateralized debt and foreign borrowing to study the impact of global imbalances on the U.S. economy in the 2000s. Our results suggest that the dynamics of foreign capital flows account for between one fourth and one third of the increase in...
Persistent link: https://www.econbiz.de/10010969208
Time-inconsistency of no-bailout policies can create incentives for banks to take excessive risks and generate endogenous crises when the government cannot commit. However, at the outbreak of financial problems, usually the government is uncertain about their nature, and hence it may delay...
Persistent link: https://www.econbiz.de/10010969240
This paper unveils a new resource for macroeconomic research: a long-run dataset covering disaggregated bank credit for …
Persistent link: https://www.econbiz.de/10010969257
Economic growth involves metamorphosis of the financial system. Forms of banks and bank money change. These changes, if … of crises. All financial crises are at root bank runs, because bank debt--of all forms--is vulnerable to sudden exit by … bank debt holders. The current crisis raises issues for crisis theory. And, empirically, studying crises is challenging …
Persistent link: https://www.econbiz.de/10010950636
We analyze a variant of the Diamond-Dybvig (1983) model of banking in which savers can use a bank to invest in a risky … project operated by an entrepreneur. The savers can buy equity in the bank and save via deposits. The bank chooses to invest … in a safe asset or to fund the entrepreneur. The bank and the entrepreneur face limited liability and there is a …
Persistent link: https://www.econbiz.de/10010950858
mismatch in their balance sheets. The data suggest that foreign banks had to borrow from the Federal Reserve Bank to meet their …
Persistent link: https://www.econbiz.de/10010950874
that has survived the worst of the economic and political crises of the last decades is highly profitable. Bank …
Persistent link: https://www.econbiz.de/10010950937
methodology to separate firm-borrowing shocks from bank supply shocks using a vast sample of matched bank-firm lending data. We … decompose loan movements in Japan for the period 1990 to 2010 into bank, firm, industry, and common shocks. The high degree of … role for granular shocks as in Gabaix (2011). As a result, bank supply shocks--i.e., movements in the supply of bank loans …
Persistent link: https://www.econbiz.de/10010951049
We use the unique circumstances that led to the Panic of 1907 to analyze its impact on economic activity. The panic was fuelled by runs on the 'shadow banks' of the time, New York's trust companies. But the shock that triggered the runs was unrelated to the nonfinancial corporations affiliated...
Persistent link: https://www.econbiz.de/10010951125