Using high-frequency data we document that episodes of market turmoil in the European sovereign bond market are on average associated with large decreases in trading volume. The response of trading volume to market stress is conditional on transaction costs. Low transaction cost turmoil episodes...

We compare the experience of Latin American external debt crises, in particular the one in the 80s, with the current European one. We do so with the aim of shedding some light on the needed adjustment mechanisms. We argue for the need of much larger debt relief in Europe. To address the moral...

We propose a model to account for two stylized facts about sovereign yields in the Euro Area: their convergence after 2000 and subsequent divergence after 2008, and the contagion among yields of the Euro periphery after the financial crisis of 2007-2008.Two borrowing countries share a bailout...