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Housing Price Bubbles and Credit Crunches : Recent Country Evidence

Pastor, Jose M. - 2015

The recent financial turbulences, which started in the US in August 2007, have affected the credit market in many countries around the world.We have chosen some countries with and without a previous housing price bubble so as to check if the presence of a former real asset price hike matters in...

Persistent link: https://www.econbiz.de/10013038845

Money Manager Capitalism and the Global Financial Crisis

Wray, L. Randall - 2009

This paper applies Hyman Minsky's approach to provide an analysis of the causes of the global financial crisis. Rather than finding the origins in recent developments, this paper links the crisis to the long-term transformation of the economy from a robust financial structure in the 1950s to the...

Persistent link: https://www.econbiz.de/10013156084

Inefficient Asset Price Booms

Neuhann, Daniel - 2019

Endogenous movements in the wealth distribution can generate asset price booms in which financial intermediaries increasingly engage in moral hazard and originate low-quality assets that are excessively exposed to aggregate risk. Central to the mechanism is a pecuniary externality whereby buyers...

Persistent link: https://www.econbiz.de/10012900330

Asset Pledgeability and Endogenously Leveraged Bubbles

Bengui, Julien - 2018

We develop a simple model of defaultable debt and rational bubbles in the price of an asset, which can be pledged as …

Persistent link: https://www.econbiz.de/10012936783

Political Booms, Financial Crises

Ordoñez, Guillermo - 2014

We show that political booms, measured by the rise in governments' popularity, predict financial crises above and beyond other better-known early warning indicators, such as credit booms. This predictive power, however, only holds in emerging economies. We show that governments in emerging...

Persistent link: https://www.econbiz.de/10013050233

Political Booms, Financial Crises

Herrera, Helios - 2014

Persistent link: https://www.econbiz.de/10013047326

Should Central Banks Prick Asset Price Bubbles? An Analysis Based on a Financial Accelerator Model with an Agent-Based Financial Market

Vasilenko, Alexey - 2018

This paper studies whether and how the central bank should prick asset price bubbles, if the effect of interest rate … policy on bubbles can significantly vary across periods. For this purpose, I first construct a financial accelerator model … with an agent-based financial market that can endogenously generate bubbles and account for their impact on the real sector …

Persistent link: https://www.econbiz.de/10012932004

Macroprudential Policy and Asset Liquidity

Chi, Chun-Che - 2021

This paper develops a dynamic model to study optimal liquidity regulations for multiple assets that differ in liquidity. I show that optimal macroprudential policies are affected by asset liquidity and the multi-asset structure. Lower asset liquidity amplifies declines in asset prices and...

Persistent link: https://www.econbiz.de/10013249781

The Market Structure of Securitisation and the US Housing Bubble

Wachter, Susan M. - 2015

Housing finance, and, specifically, the subprime private label securitisation market in the US, was at the epicentre of the global financial crisis. Excessive debt expansion in the run-up to the crisis resulted in credit risk, under-identified and mispriced ex ante, and in systemic risk. This...

Persistent link: https://www.econbiz.de/10013032217

The increased importance of asset price misalignments for business cycle dynamics

Bask, Mikael; Madeira, João - 2011

We outline a dynamic stochastic general equilibrium (DSGE) model with trend extrapo-lation in asset pricing that we fit to quarterly U.S. macroeconomic time series with Baye-sian techniques. To be more precise, we modify the DSGE model in Smets and Wouters (2007) by incorporating asset traders...

Persistent link: https://www.econbiz.de/10009151734