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, collateral values, and debt limits. We show that the collateral premium of a durable asset will become the lowest right before a …
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collateral to support arbitrage trades. We show that with volatile asset demands, arbitrage becomes risky. With information … frictions, a looser collateral policy might render the economy more vulnerable to extremely large demand shocks, while a tighter … collateral constraint helps maintain the stability at the cost of market liquidity supply …
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, collateral values, and debt limits. We show that the collateral premium of a durable asset will become the lowest right before a …
Persistent link: https://www.econbiz.de/10011973979
As Korea's household debt has increased rapidly since the mid-2000s, concerns that its economy's hard-wired leveraging may negatively impact economic activity have grown. Calls are being made for policy actions to return the economy to its long-run trend. Housing preferences and monetary shocks...
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