We propose a regulatory approach for restricting debt financing as an amplification mechanism across the financial … focuses instead on debt financing, endogenous feedback mechanisms and resource allocation. It explicitly addresses the …

after the introduction of TARP and the rescue of AIG. Anxiety about European debt markets saw the systemic risk begin to …

a version augmented by a default premium on government debt due to a perceived risk of sovereign debt default. Model …. The estimated default probability is highly debt-elastic, indicating that default fears are a relevant concern. The … active monetary policy and stronger fiscal feedbacks from debt on taxes can lead to less volatile inflation and debt dynamics …

, our results indicate that higher government debt-to-GDP ratios have negatively affected long-term multipliers. …

We analyze the interaction between bank rescues, financial fragility and sovereign debt discounts. We construct a model … debt obligations. We analyse the impact of a financial crisis, first under full government credibility and then with an … endogenous sovereign debt discount. The introduction of the default possibility does not have any impact IF all government debt …

We investigate the effectiveness of `Keynesian' fiscal stimuli when government deficits and debt rollovers are … loans are crowded out by government debt in the credit provision channel. This lowers investment and (future) capital stocks … cycle further lowe ring the fiscal multiplier. Longer maturity debt leads to larger capital losses and lower Keynesian …

Recent macro developments in the euro area have highlighted the interactions between fiscal policy, sovereign debt, and … with recent research, but introduce asset choice and sovereign debt holdings in the portfolio of banks. Using this model … sovereign debt under a leverage constraint. Our results show that, when banksinvest a substantial fraction of their assets in …

the poisonous interaction between bank rescues, financial fragility and sovereign debt discounts. In our model balance … deficits. The financial intermediaries face the risk of a (partial) default of the government on its debt obligations. We … analyse the impact of a financial crisis, first under full government credibility and then with an endogenous sovereign debt …