Efficient Market Theory and the Crisis
... According to data collected by Prof. Robert Shiller of Yale University, in the 61 years from 1945 through 2006 the maximum cumulative decline in the average price of homes was 2.84% in 1991. If this low volatility of home prices persisted into the future, a mortgage security composed of a nationally ...
... According to data collected by Prof. Robert Shiller of Yale University, in the 61 years from 1945 through 2006 the maximum cumulative decline in the average price of homes was 2.84% in 1991. If this low volatility of home prices persisted into the future, a mortgage security composed of a nationally ...
Financing natural disaster risk in developing countries
... Adverse selection and moral hazard can be dealt with ...
... Adverse selection and moral hazard can be dealt with ...
15 Mosec
... Outcome of Mosec I • Significant reduction in overall cost of funding: – Cost to MFI reduced between 200 to 500 bps. – As investors understand the sector better, rates are expected to drop even further. • Opening up new sources of funding: – The senior tranche was purchased by the treasury departme ...
... Outcome of Mosec I • Significant reduction in overall cost of funding: – Cost to MFI reduced between 200 to 500 bps. – As investors understand the sector better, rates are expected to drop even further. • Opening up new sources of funding: – The senior tranche was purchased by the treasury departme ...
Lecture 3 securitization
... packages the pool of collaterals into notes, with explicit priority of payments and sells them to investors. – Thus securitization is, first and foremost, a financing mechanism for the issuer of the collaterals. – The tranche structure makes securitization interesting, in terms of risk. ...
... packages the pool of collaterals into notes, with explicit priority of payments and sells them to investors. – Thus securitization is, first and foremost, a financing mechanism for the issuer of the collaterals. – The tranche structure makes securitization interesting, in terms of risk. ...
Uncertainty and Risk
... When many firms sell the same item, there is a range of prices and buyers try to find the lowest price. But searching for a lower price is costly. Buyers balance the expected gain from further search against the cost of further search. To perform this balancing act, buyers use a decision rule called ...
... When many firms sell the same item, there is a range of prices and buyers try to find the lowest price. But searching for a lower price is costly. Buyers balance the expected gain from further search against the cost of further search. To perform this balancing act, buyers use a decision rule called ...
jerzy pruski presentation 0
... Private sector solution not available Rescue activities not justified Moral hazard ...
... Private sector solution not available Rescue activities not justified Moral hazard ...
Ch.1 - 13ed Overview of Fin Mgmt
... Country risk. Depends on the country’s economic, political, and social environment. Exchange rate risk. Non-dollar denominated investment’s value depends on what happens to exchange rate. Exchange rates affected ...
... Country risk. Depends on the country’s economic, political, and social environment. Exchange rate risk. Non-dollar denominated investment’s value depends on what happens to exchange rate. Exchange rates affected ...
LESSONS FROM THE HOUSING CRISIS BOG_Karakitsos
... levels of asset prices – But risk creating new bubbles (US Treasuries) ...
... levels of asset prices – But risk creating new bubbles (US Treasuries) ...
Private Information
... Faced with moral hazard and adverse selection, banks use signals to discriminate between borrowers and ration or limit loans to amounts below that demanded. To restrict the amounts they are willing to lend to borrowers, banks use signals such as length of time in a job, ownership of a home, marital ...
... Faced with moral hazard and adverse selection, banks use signals to discriminate between borrowers and ration or limit loans to amounts below that demanded. To restrict the amounts they are willing to lend to borrowers, banks use signals such as length of time in a job, ownership of a home, marital ...
Uncertainty and Risk
... Faced with moral hazard and adverse selection, banks use signals to discriminate between borrowers and ration or limit loans to amounts below that demanded. To restrict the amounts they are willing to lend to borrowers, banks use signals such as length of time in a job, ownership of a home, marital ...
... Faced with moral hazard and adverse selection, banks use signals to discriminate between borrowers and ration or limit loans to amounts below that demanded. To restrict the amounts they are willing to lend to borrowers, banks use signals such as length of time in a job, ownership of a home, marital ...
PPT - unece
... revealed by the crisis • Main studies – Issing Committee, report to G-20 Finance Ministers and Governors - Better data relating to risk ...
... revealed by the crisis • Main studies – Issing Committee, report to G-20 Finance Ministers and Governors - Better data relating to risk ...
A Chronicle of the Financial Crisis
... – But ability and willingness to do this is limited – Growing fiscal pressures are leading to more contractionary policies around the world, especially in Europe after the Greek crisis – In US, states and localities are facing massive shortfalls of revenues—with balanced budget framework, negative s ...
... – But ability and willingness to do this is limited – Growing fiscal pressures are leading to more contractionary policies around the world, especially in Europe after the Greek crisis – In US, states and localities are facing massive shortfalls of revenues—with balanced budget framework, negative s ...
Business Ethics - FIU College of Business
... ◦ seeking to beat quarterly estimates ◦ however, in order for a company to thrive and maintain viability, long-term goals are more important than short-term gain ...
... ◦ seeking to beat quarterly estimates ◦ however, in order for a company to thrive and maintain viability, long-term goals are more important than short-term gain ...
security analysis - Goenka College of Commerce and Business
... change, availability of raw materials, change in consumer preference, labour problems etc. This portion of the risk can be eliminated by an investor ...
... change, availability of raw materials, change in consumer preference, labour problems etc. This portion of the risk can be eliminated by an investor ...
Fact Finder - North American Company
... _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ ...
... _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ ...
Rising Awareness on NatCat - A Global Underwriter`s View
... Deterministic models measure losses caused by a specific event; for ...
... Deterministic models measure losses caused by a specific event; for ...
The Global Financial Crisis
... Conflicts of interest characterize the granting of credit (lending) and the use of credit (investing) by the same entity Depository institutions possess enormous financial power, by virtue of their control of other people’s money (O-P-M), must be limited to ensure soundness and competition in the ma ...
... Conflicts of interest characterize the granting of credit (lending) and the use of credit (investing) by the same entity Depository institutions possess enormous financial power, by virtue of their control of other people’s money (O-P-M), must be limited to ensure soundness and competition in the ma ...
ARK_letter10-07 - ARK Financial Services
... The main culprit for this volatility (as we all know by now) was the melt down in the subprime mortgage market. But what exactly happened here? The subprime mortgage market consists of borrowers with poor credit histories and the brokers who made risky loans to those borrowers. It is a part of the m ...
... The main culprit for this volatility (as we all know by now) was the melt down in the subprime mortgage market. But what exactly happened here? The subprime mortgage market consists of borrowers with poor credit histories and the brokers who made risky loans to those borrowers. It is a part of the m ...
Presentation
... opportunity cost refers to what a person gives up when a decision is made. This cost, also called a trade-off, may involve one or more of your resources (time, money, and effort). personal opportunity costs may involve time, health, or energy. For example, time spent on studying usually means lost t ...
... opportunity cost refers to what a person gives up when a decision is made. This cost, also called a trade-off, may involve one or more of your resources (time, money, and effort). personal opportunity costs may involve time, health, or energy. For example, time spent on studying usually means lost t ...
Systematic and Unsystematic Risk
... R + U (expected + unexpected) Investors form “expectations” about future Expected information is already discounted by the market • i.e., the value of the information is already incorporated into the stock prices • Attempts to exploit Public information (make large returns) will not be successful C ...
... R + U (expected + unexpected) Investors form “expectations” about future Expected information is already discounted by the market • i.e., the value of the information is already incorporated into the stock prices • Attempts to exploit Public information (make large returns) will not be successful C ...
US housing crisis special features not generally present in Europe
... where by combining a primary and a secondary mortgage, borrowers could cover the total cost of the purchase without having to take out private mortgage insurance (which is normally mandatory when the personal down-payment is less than 20%). In the second case, households were able to benefit from th ...
... where by combining a primary and a secondary mortgage, borrowers could cover the total cost of the purchase without having to take out private mortgage insurance (which is normally mandatory when the personal down-payment is less than 20%). In the second case, households were able to benefit from th ...
Our World at a Glance
... regulator. • The Federal Reserve would be natural place for this position. ...
... regulator. • The Federal Reserve would be natural place for this position. ...
