Working Paper 17-6: Does Greece Need More Official Debt Relief? If
... assumptions, including a set of “short-term” debt relief measures that were decided by the ESM in January 2017.7 Second, it attempts to quantify the impact of growth, inflation, and interest rate uncertainty on the projected paths using a “fan chart approach” based on Monte Carlo simulations (see fi ...
... assumptions, including a set of “short-term” debt relief measures that were decided by the ESM in January 2017.7 Second, it attempts to quantify the impact of growth, inflation, and interest rate uncertainty on the projected paths using a “fan chart approach” based on Monte Carlo simulations (see fi ...
Felonious, Erroneous, It`s All Odious: A Story of Debt Gone Wrong
... sovereign could arguably liquidate some of its assets.37 Unlike a corporation, however, a sovereign debtor can—at least in an abstract sense—always pay its debt.38 The government may increase taxes or divert domestic production to generate foreign export revenue.39 With these capabilities, it become ...
... sovereign could arguably liquidate some of its assets.37 Unlike a corporation, however, a sovereign debtor can—at least in an abstract sense—always pay its debt.38 The government may increase taxes or divert domestic production to generate foreign export revenue.39 With these capabilities, it become ...
Optimal Debt and Equity Values in the Presence of Chapter 7 and
... default leads to a decline in overall firm value relative to the first-best scenario in both the Leland model and our model. Debt forgiveness may also be in the interest of the lenders and the firm as a whole because costly liquidation could be avoided. Nonetheless, total firm value maximization gen ...
... default leads to a decline in overall firm value relative to the first-best scenario in both the Leland model and our model. Debt forgiveness may also be in the interest of the lenders and the firm as a whole because costly liquidation could be avoided. Nonetheless, total firm value maximization gen ...
When managing the debt, Governments deal with the
... for a great deal of the debt’s growth, increasing from 17% of GDP in 1996 to 56% of GDP by 2001. As a consequence, total public interest payments grew from 3.5% of GDP to 5,2% in the same period. The tendency continued in 2002 and the net NFPS debt level reached 52% of GDP. The main factors behind s ...
... for a great deal of the debt’s growth, increasing from 17% of GDP in 1996 to 56% of GDP by 2001. As a consequence, total public interest payments grew from 3.5% of GDP to 5,2% in the same period. The tendency continued in 2002 and the net NFPS debt level reached 52% of GDP. The main factors behind s ...
NBER WORKING PAPER SERIES INVESTMENT CYCLES AND SOVEREIGN DEBT OVERHANG Mark Aguiar
... increased current consumption. This provides a rationale for imposing a debt constraint on the government. These type of considerations have led countries such as Chile and Brazil to place budgetary restrictions on their governments. Our analysis highlights not only the circumstances under which suc ...
... increased current consumption. This provides a rationale for imposing a debt constraint on the government. These type of considerations have led countries such as Chile and Brazil to place budgetary restrictions on their governments. Our analysis highlights not only the circumstances under which suc ...
Determinants of Spread and Creditworthiness for Emerging Market
... Initiated by Mexico’s Brady bond issue in 1989, emerging market sovereign issues surged during the 1990s. This has generated an increasing need for both investors and issuers to understand what factors determine bond prices and, therefore, also spreads. Only few earlier studies have been conducted i ...
... Initiated by Mexico’s Brady bond issue in 1989, emerging market sovereign issues surged during the 1990s. This has generated an increasing need for both investors and issuers to understand what factors determine bond prices and, therefore, also spreads. Only few earlier studies have been conducted i ...
The Trust Indenture Act of 1939 and Out-of
... feature. The troubled issuer can stop making bond payments that it cannot afford, and the bondholders are able to trade in bad debt for the chance to profit from the company’s eventual turnaround. But, unlike our example, a typical workout involves far more than two bondholders, and this creates a s ...
... feature. The troubled issuer can stop making bond payments that it cannot afford, and the bondholders are able to trade in bad debt for the chance to profit from the company’s eventual turnaround. But, unlike our example, a typical workout involves far more than two bondholders, and this creates a s ...
Debt, Equity and Hybrid Decoupling
... from the disclosure rules that apply to full ownership, and not voluntarily disclosed), morphable (accompanied by the informal ability to acquire voting rights), or both (hidden (morphable) ownership). 3 Hidden (morphable) ownership can be seen as one form of ‘soft parking’ of shares: arranging for ...
... from the disclosure rules that apply to full ownership, and not voluntarily disclosed), morphable (accompanied by the informal ability to acquire voting rights), or both (hidden (morphable) ownership). 3 Hidden (morphable) ownership can be seen as one form of ‘soft parking’ of shares: arranging for ...
What Drives Long-term Capital Flows? A Theoretical and Empirical
... from the model, and estimated using the Lane and Milesi-Ferretti database. Results give some qualitative support to the idea of convergence. Countries with low levels of initial debt did increase their borrowing over the sample period, at a rate of about 2 per cent per year, an estimate surprisingly ...
... from the model, and estimated using the Lane and Milesi-Ferretti database. Results give some qualitative support to the idea of convergence. Countries with low levels of initial debt did increase their borrowing over the sample period, at a rate of about 2 per cent per year, an estimate surprisingly ...
Risk-Adjusted Performance of Private Equity Investments
... that for diversification purposes, securities portfolios should include 10% to 15% of PE exposure. However, they concentrate on early stage funds lacking data on individual transaction leverages and do not correct for leverage risk. Cochrane (2005) points out that empirical PE research usually only ...
... that for diversification purposes, securities portfolios should include 10% to 15% of PE exposure. However, they concentrate on early stage funds lacking data on individual transaction leverages and do not correct for leverage risk. Cochrane (2005) points out that empirical PE research usually only ...
Fiscal Monitor - Addressing Fiscal Challenges to Reduce Economic
... reflect the significant goodwill that the governments of Japan and the United States have earned with investors, even though many of their conventional fiscal indicators—deficits, debt ratios, and projected age-related spending growth (in the United States)—are no better than in many European countries ...
... reflect the significant goodwill that the governments of Japan and the United States have earned with investors, even though many of their conventional fiscal indicators—deficits, debt ratios, and projected age-related spending growth (in the United States)—are no better than in many European countries ...
Debt Levels and Share Price - a Sensitivity Analysis on Vestas
... In their seminal work, Miller and Modigliani (1958) posit that in a perfect market, the capital structure of the company is irrelevant and therefore, has no influence on the value of the company. However, their theory was based on numerous and quite restrictive assumptions which make their conclusio ...
... In their seminal work, Miller and Modigliani (1958) posit that in a perfect market, the capital structure of the company is irrelevant and therefore, has no influence on the value of the company. However, their theory was based on numerous and quite restrictive assumptions which make their conclusio ...
Budget Blueprint: How Lessons from Canada`s
... billion, lower than the originally expected $224.9 billion and much lower than the previous year’s revenues of $233.1 billion (Canada, Department of Finance, 2009; Canada, Department of Finance, Canada, 2010d). The bulk of the deficit, however, is explained by a steep increase in federal program spe ...
... billion, lower than the originally expected $224.9 billion and much lower than the previous year’s revenues of $233.1 billion (Canada, Department of Finance, 2009; Canada, Department of Finance, Canada, 2010d). The bulk of the deficit, however, is explained by a steep increase in federal program spe ...
What is a Sustainable Public Debt?∗
... advantage of this approach is that it provides a straigthforward and powerful method to conduct nonstructural empirical tests that are sufficient to satisfy fiscal solvency. These tests require only data on the primary balance, outstanding debt and a few control variables. The data are then used to ...
... advantage of this approach is that it provides a straigthforward and powerful method to conduct nonstructural empirical tests that are sufficient to satisfy fiscal solvency. These tests require only data on the primary balance, outstanding debt and a few control variables. The data are then used to ...
SRC review guide for general-purpose governments
... [SECTION 3, FINANCIAL SECTION – REPORT OF THE INDEPENDENT AUDITOR, ...
... [SECTION 3, FINANCIAL SECTION – REPORT OF THE INDEPENDENT AUDITOR, ...
Clamoring for Greenbacks: Explaining the
... developed, would issue debt overwhelmingly in major hard currencies. Figure 3 illustrates the volume of international debt securities issued in ‘top four currencies,’ namely, the U.S. dollar, the Euro, the British pound, and the Japanese yen. The share of ‘top four currencies’ in the total outstandi ...
... developed, would issue debt overwhelmingly in major hard currencies. Figure 3 illustrates the volume of international debt securities issued in ‘top four currencies,’ namely, the U.S. dollar, the Euro, the British pound, and the Japanese yen. The share of ‘top four currencies’ in the total outstandi ...
The Existence of Corporate Bond Clawbacks
... this debt overhang. 7 We demonstrate that owners anticipate the possibility of renegotiation which gives a degree of flexibility in the capital structure. Hart and Moore (1998) support this view based on a dynamic theory of debt where a borrower threatens to withdraw from the project and triggers re ...
... this debt overhang. 7 We demonstrate that owners anticipate the possibility of renegotiation which gives a degree of flexibility in the capital structure. Hart and Moore (1998) support this view based on a dynamic theory of debt where a borrower threatens to withdraw from the project and triggers re ...
Debt cycles, instability and fiscal rules: a Godley
... hypothesis. Recent contributions to this literature include Ryoo (2010, 2013a), Chiarella and Di Guilmi (2011), Eggertsson and Krugman (2012), Passarella (2012), Sordi and Vercelli (2012), Keen (2013), Nikolaidi (2014) and Bhattacharya et al. (2015). However, none of these models include explicitly ...
... hypothesis. Recent contributions to this literature include Ryoo (2010, 2013a), Chiarella and Di Guilmi (2011), Eggertsson and Krugman (2012), Passarella (2012), Sordi and Vercelli (2012), Keen (2013), Nikolaidi (2014) and Bhattacharya et al. (2015). However, none of these models include explicitly ...
accounting for long-term assets, long
... Generally, US GAAP guidance for leases applies only to PP&E and, in particular, not to intangibles. This means that with one exception the future payments associated with leased intangibles (e.g., licensing arrangements) can’t be capitalized: they are expensed as incurred during the term of the cont ...
... Generally, US GAAP guidance for leases applies only to PP&E and, in particular, not to intangibles. This means that with one exception the future payments associated with leased intangibles (e.g., licensing arrangements) can’t be capitalized: they are expensed as incurred during the term of the cont ...
THE IMPACT OWNERSHIP STRUCTURE ON THE
... Liquidity and leverage risk are considered as one of the serious concerns and challenges for financial performance in organizations. Towards this end, the research sought to establish effect of liquidity and leverage on financial performance of commercial state corporations in the tourism industry i ...
... Liquidity and leverage risk are considered as one of the serious concerns and challenges for financial performance in organizations. Towards this end, the research sought to establish effect of liquidity and leverage on financial performance of commercial state corporations in the tourism industry i ...
A Financial Optimization Approach to Quantitative
... static strategies in fictitious future macroeconomic developments. In this report we describe how the SNDO’s simulation model is used along with a clustering algorithm to form future scenarios, which are then used by an optimization model to find an optimal decision regarding the debt management pro ...
... static strategies in fictitious future macroeconomic developments. In this report we describe how the SNDO’s simulation model is used along with a clustering algorithm to form future scenarios, which are then used by an optimization model to find an optimal decision regarding the debt management pro ...
A Surplus of Ambition: Can Europe Rely on Large Primary
... small, open economies where market pressure is intense are more likely to exhibit large, persistent surpluses. So are countries where the debt ratio is high, again heightening the pressure for adjustment. In terms of institutional correlates, we find that surplus episodes are more likely when elect ...
... small, open economies where market pressure is intense are more likely to exhibit large, persistent surpluses. So are countries where the debt ratio is high, again heightening the pressure for adjustment. In terms of institutional correlates, we find that surplus episodes are more likely when elect ...
International Financial Integration in the Aftermath of the
... asymmetric pattern proved to be important factor in terms of the global risk distribution during the global financial crisis. In particular, under this configuration major advanced economies attracted large-scale debt inflows during the run up to the crisis, which were partly recycled to fund foreig ...
... asymmetric pattern proved to be important factor in terms of the global risk distribution during the global financial crisis. In particular, under this configuration major advanced economies attracted large-scale debt inflows during the run up to the crisis, which were partly recycled to fund foreig ...
The Influence of Capital Structure and Macroeconomic Factor
... cause the cost of bankruptcy (bankruptcy cost) is greater. The trade off theory explaining the relationship between tax, bankruptcy risk and the use of a debt due to the decision taken by the company’s capital structure (Brealey and Myers, 1991). This theory is a balance between the advantages and d ...
... cause the cost of bankruptcy (bankruptcy cost) is greater. The trade off theory explaining the relationship between tax, bankruptcy risk and the use of a debt due to the decision taken by the company’s capital structure (Brealey and Myers, 1991). This theory is a balance between the advantages and d ...
The Facts on Medicare Spending and Financing
... Part B and Part D do not have financing challenges similar to Part A, because both are funded by beneficiary premiums and general revenues that are set annually to match expected outlays. However, future increases in spending under Part B and Part D will require increases in general revenue funding ...
... Part B and Part D do not have financing challenges similar to Part A, because both are funded by beneficiary premiums and general revenues that are set annually to match expected outlays. However, future increases in spending under Part B and Part D will require increases in general revenue funding ...