Author Topic: Gunned down IMF officer's recent investigation  (Read 7658 times)

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Gunned down IMF officer's recent investigation
« on: October 12, 2009, 04:13:51 pm »
below is an abstract from a recent paper by Ashoka Mody, the IMF officer recently shot
you have to pay 5$ to get the whole thing, but it looks interesting

How did the Subprime Crisis, a problem in a small corner of U.S. financial markets, affect the entire global banking system? To shed light on this question we use principal components analysis to identify common factors in the movement of banks' credit default swap spreads. We find that fortunes of international banks rise and fall together even in normal times along with short-term global economic prospects. But the importance of common factors rose steadily to exceptional levels from the outbreak of the Subprime Crisis to past the rescue of Bear Stearns, reflecting a diffuse sense that funding and credit risk was increasing. Following the failure of Lehman Brothers, the interdependencies briefly increased to a new high, before they fell back to the pre-Lehman elevated levels – but now they more clearly reflected heightened funding and counterparty risk. After Lehman's failure, the prospect of global recession became imminent, auguring the further deterioration of banks' loan portfolios. At this point the entire global financial system had become infected.


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Re: Gunned down IMF officer's recent investigation
« Reply #1 on: October 12, 2009, 04:31:03 pm »
Financial Reform: What Shakes It? What Shapes It? (2009)

    * Ashoka Mody

What accounts for the worldwide advance of financial reforms in the last quarter century? Using a new index of financial liberalization, we find that influential events shook the policy status quo. Balance of payments crises spurred reforms, but banking crises set liberalization back; falling global interest rates strengthened reformers, while new governments went both ways. However, the overall trend toward liberalization reflected pressures and incentives generated by initial reforms that raised the likelihood of additional reforms, stimulated further by the need to catch up with regional reform leaders. In contrast, ideology and country structure had limited influence. (JEL P11, P16, P34, N20, G28) In the last quarter of the twentieth century, financial systems worldwide moved from government ownership or control towards greater private provision of financial services under fewer operational restrictions. However, these liberalization efforts varied considerably across countries in timing, speed, and magnitude—occasionally, previous reforms were reversed. Using a newly constructed index of financial liberalization, we document trends in financial sector liberalization and ask: when, by how much, and why did countries reform? A large and technically sophisticated literature has examined the consequences of

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Language    English