Tuesday, January 26, 2021

The Rise of Non-Bank US Dollar Credit Continues

The latest BIS global liquidity indicators showed that the share of Non-bank USD denominated credit continued its rising trend.

Bank Equity and Banking Crises

In a recent study "Bank Equity and Banking Crises" by Matthew Baron (of Cornell University), Emil Verner (MIT Sloan), and Wei Xiong (Princeton University), the three economists developed a comprehensive database of bank equity prices and banking crises with a full-sample of 46 countries from 1870-2016. They try to understand the dynamic between bank equity decline and banking crises.

ECB’s Praet on Eurozone’s Secular Stagnation

Peter Praet, Executive Board Member of the ECB:Central to this debate is whether the slow growth can be attributed to cyclical – and hence ultimately transitory – factors related to the financial crisis,...

Media Sentiment and International Asset Prices

A new working paper from the IMF which tries to assess the impact of media sentiment on equity markets.

The Non‐Bank Credit Cycle

In a new working paper "The Non‐Bank Credit Cycle", researchers Esti Kemp, René van Stralen, Alexandros Vardoulakis, and Peter Wierts tried to look into the cyclical properties of non‐bank credit and its relevance for financial stability.

What do others think about Paul Romer’s worries… (II)

The discussion on Paul Romer's "The Trouble with Macroeconomics" continues in the blogosphere, and Simon Wren -Lewis's "Paul Romer on macroeconomics" is one of the Must-Reads.In his comments, Wren-Lewis said that Romer's view is...

CoCo issuance and bank fragility

A series of papers by Stefan Avdjiev, Bilyana Bogdanova, Patrick Bolton, Wei Jiang, and Anastasia Kartasheva on this topic is highly recommended.

FedSpeak Might Not Have Much Effects on Public’s Inflation Expectation

In a recent NBER working paper "Monetary Policy Communications and their Effects on Household Inflation Expectations", economists Olivier Coibion, Yuriy Gorodnichenko and Michael Weber tried to find out how the household's expectation for inflation change with regard to the information they received.

Nonbank Lending

In their recent working paper "Nonbank Lending", economists Sergey Chernenko, Isil Erel, and Robert Prilmeier provided an insightful overview of the sources and terms of private debt financing during the post-crisis period.

#WITGT21 Paragraph of the Day 

By Simon Wren-Lewis:What is hardly ever said, so I make no apologies for doing so once more, is that macroeconomic theory has in some ways ‘had a good crisis’. Basic Keynesian macroeconomic theory says...