Financial crisis
IMF paper untangles liquidity indicators
A study by IMF staff finds price and quantity indicators can be used to separate the effects of supply and demand shocks on global liquidity; changes especially telling in a crisis
Malaysia’s Zeti says Asia must prepare for ‘new global landscape’
Zeti Akhtar Aziz highlights challenges due to the changing world economy following the financial crisis; says Asia is ‘well ahead’ with implementing financial stability policies
IMF paper considers monetary union risks
Research published by the IMF compares the trading benefits and stability costs of entering a monetary union; highlights flaws in Emu set-up
ECB paper examines ability of central banks to tackle dual liquidity crises
ECB study investigates how different monetary regimes impact on the ability of central banks to contain dual liquidity crises; finds less interference equates to more action
San Francisco paper studies effect of crisis on potential output
Federal Reserve Bank of San Francisco study examines US output potential; distinguishes between long-running trends and consequences of financial crisis
Monetary easing does not prompt crisis recovery, says BIS paper
Paper published by the Bank for International Settlements finds monetary easing does not help economic recovery following a financial crisis downturn; deleveraging produces more positive effects
CBP panellists raise concerns over macro-prudential innovation
Central Banking Publications webinar participants debate challenge of implementing macro-prudential policies; panellists highlight risks from central banks’ limited experience with some tools
Research warns of global liquidity trap
Smithers & Co report says quantitative easing unlikely to boost demand due to worldwide liquidity trap; calls for fiscal stimulus but says such action is not expected
ECB paper analyses factors driving portfolio flows
Working paper studies time-varying drivers of capital flows to emerging markets; finds investors are more sensitive to local factors during market stress, while extreme stress can cause a panic
ECB’s Cœuré justifies use of non-standard policy measures
Benoît Cœuré explains threat to the interest rate channel created need for alternative monetary policy measures; says outright monetary transactions aim to restore ‘monetary dominance’
BIS raises fears over lower global growth trajectory
Bank for International Settlements Quarterly Review says global growth outlook deteriorated further over the quarter; warns of diminishing benefits to unconventional monetary policy
IMF paper dissects shadow banking bailouts
IMF study examines how bailouts were used in the shadow banking system during the crisis; suggests the risk of future bailouts remains
ECB’s Asmussen highlights increasing roles of central banks
Jörg Asmussen says central banks have assumed new crisis management responsibility; sets out vision of ECB’s future roles when crisis ends
Bank of Spain paper develops model of market volatility
Researchers produce measure of volatility able to cope with ‘vast’ panels of data; find model performs better than others that use shorter time horizons
BIS chief advocates deeper policy cooperation
Jaime Caruana calls on central banks to consider international implications of domestic monetary policy; says segmenting markets does not make sense
IMF paper studies emerging market bond spreads
Working paper tests different explanatory variables for emerging market bond spreads over time; finds importance may change based on business cycle and external factors
Impending drop in economic growth, warns South African research
South African Reserve Bank working paper uses new model to analyse financial conditions; finds conditions have declined and threaten GDP growth
The future of bank capital
Prudential regulators are relying on the Modigliani-Miller theorem to hold true as banks are required to hold substantially more capital. But could their faith in the theorem be misplaced?
Book notes: The Money Trap
Robert Pringle’s new book is driven by a sense of missionary zeal
Book notes: End This Depression Now!
One of the rock stars of economics has written another hit
Carney discusses the “right kind” of globalisation
Governor of the Bank of Canada explains how globalisation can be harnessed to create prosperity for Canadians; says responsibility for past mistakes lay with many parties
ECB hiring may not be enough to cope with workload, says Ipso chief
Union head says European Central Bank’s plan to recruit 40 additional staff to help cope with increased workload is unlikely to be sufficient
Japan holds rates and delays disbursement of fund provision
Bank of Japan maintains benchmark rate at near zero; puts off first issuance of fund provision due to reform plans for Libor
Australia and Sri Lanka leave rates on hold
Reserve Bank of Australia and Central Bank of Sri Lanka highlight worsening economic conditions around the world as they announce benchmark rates will remain unchanged