Why Not Default? the Structural Power of Finance in Sovereign Debt Crises
Total Page:16
File Type:pdf, Size:1020Kb
Load more
Recommended publications
-
3354:1-20-07.1 Tax-Exempt Debt Compliance Procedure
3354:1-20-07.1 Tax-Exempt Debt Compliance Procedure (A) Tax-Exempt Debt The use of tax-exempt debt plays an important role in funding a significant portion of the College’s capital projects. As a result, the College realizes the importance of complying with federal and institutional requirements regarding the issuance and ongoing management of its tax-exempt debt. This procedure is intended to define compliance practices including compliance actions, records management, and process continuity within the Administration and Finance Department. (B) Definitions Post-Issuance Debt Compliance: The activities undertaken following the issuance of tax-exempt debt in order to comply with federal guidelines. Failure to comply with federal guidelines could potentially render the interest of debt as taxable to investors. Tax-Exempt Debt (Bonds) Issued by the College: Debt issued and managed (1) by the College; or (2) by a State authority at the request of the College and for which the College pays its pro-rata share of the debt service. (C) Maintaining Tax-Exempt Status Tax-exempt bonds are valid debt obligations used by the College to finance construction of facilities, permanent improvements, and to receive funds in anticipation of the collection of tax receipts. This tax-exempt status remains throughout the life of the debt provided that all applicable federal tax laws are satisfied. Post-issuance tax compliance begins with the debt issuance process itself and provides for a continuing focus on investments of debt proceeds and use of debt-financed property. In order to maintain the debt status as tax-exempt, the College must comply with post-issuance debt requirements. -
In Chart 1, Our Benchmarking Shows That Many Companies Significantly
October 2015 In Chart 1, our benchmarking shows that many companies significantly underestimate the risk of a default to their company compared to S&P’s experience of its ratings’ default rates. Also, it is our experience that many companies trivialize a technical default, thinking it is of no real consequence. Legally, any default is a default, and starts a chain of consequences that is hard to control, as Chart 2 shows. Borrowers have a legal obligation to review their compliance with all of their covenants of all of their debt agreements on at least a quarterly basis. In addition, to justify classifying the debt as long-term per ASC 470-10, companies must verify that the debt has no covenant violations, no matter how insignificant. For public companies, such verification is a necessary SOX control. Some 80% of the 350 companies who reported complying with Sarbanes-Oxley in the 2012 AFP Debt Compliance Benchmarking done with DCS, and in our 2015 Debt Compliance Benchmarking, include debt compliance as an explicit part of their SOX process. Please see Chart 3. Charts 4 and 5 show the magnitude of the task: there are many covenants that can only be adequately reviewed by Subject Matter Experts (SMEs) outside of Treasury. Yet for many companies, debt compliance is an insular, silo process within Treasury. Fully 50% of the companies in both studies did not have a debt compliance policy. Lacking a policy can have these consequences: 1. An incomplete and inadequate process with no debt compliance objectives, no assignment of responsibilities, and no documentation of compliance 2. -
O Robert Mundell Και Το Βραβείο Nobel Στα Οικονομικά
SAE./No.178/April 2021 Studies in Applied Economics ROBERT MUNDELL, 1932-2021: AHEAD OF HIS TIME Miranda Xafa Johns Hopkins Institute for Applied Economics, Global Health, and the Study of Business Enterprise Robert Mundell, 1932-2021: Ahead of his Time By Miranda Xafa About the Series The Studies in Applied Economics series is under the general direction of Professor Steve H. Hanke, Founder and Co-Director of the Johns Hopkins Institute for Applied Economics, Global Health, and the Study of Business Enterprise ([email protected]). About the Author Miranda Xafa started her career at the International Monetary Fund in Washington in 1980 and moved on to senior positions in government and in the financial sector. In 1991-93 she served as chief economic advisor to Prime Minister Constantin Mitsotakis in Athens, and subsequently worked as a financial market strategist at Salomon Brothers and Citigroup in London. After serving as a member of the IMF’s Executive Board in 2004-09, she is now a senior scholar at the Centre for International Governance Innovation (CIGI). She holds a Ph.D. in Economics from the University of Pennsylvania and has taught economics at the University of Pennsylvania and Princeton University. 1 I met Bob Mundell in Washington in 1982, when I was already working at the International Monetary Fund, at a conference on the international monetary system. My first impression was the absolute confidence with which he expressed his views. When one of the participants in his panel claimed that the data did not confirm his views, he responded: "If the data do not confirm my views, then the data are wrong." I had the chance to follow his life and career, and to participate in the conferences he organized and chaired in the last two decades in his beloved Palazzo Mundell in Tuscany where he lived. -
Capital Flows and Reversals in Europe, 1919-32 Olivier Accominotti and Barry Eichengreen NBER Working Paper No
NBER WORKING PAPER SERIES THE MOTHER OF ALL SUDDEN STOPS: CAPITAL FLOWS AND REVERSALS IN EUROPE, 1919-32 Olivier Accominotti Barry Eichengreen Working Paper 19580 http://www.nber.org/papers/w19580 NATIONAL BUREAU OF ECONOMIC RESEARCH 1050 Massachusetts Avenue Cambridge, MA 02138 October 2013 Olivier Accominotti thanks the Woodrow Wilson School at Princeton University for hosting him during the preliminary phase of this project and the librarians at the Mudd Manuscript Library for their support. The authors thank Stefano Battilossi, Vincent Bignon, Rui Esteves, Marc Flandreau, Harold James, Leandro Prados de la Escosura, Albrecht Ritschl, Peter Temin, Stefano Ugolini, Jeff Williamson, participants at the CEPR Economic History Symposium in Perugia, at the Monetary History Group seminar at Rothschild and at seminars at Universidad Carlos III Madrid and Australian National University for helpful comments. We also thank Jef Boeckx and Gian Maria Milesi-Ferretti for sharing data and advice on Eurozone countries’ balance of payment statistics, and Marc Flandreau and Norbert Gaillard for sharing the ratings data. All remaining errors are ours. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peer- reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications. © 2013 by Olivier Accominotti and Barry Eichengreen. All rights reserved. Short sections of text, not to exceed two paragraphs, may be quoted without explicit permission provided that full credit, including © notice, is given to the source. -
The Role of the IMF in the Global Financial Crisis
The Role of the IMF in the Global Financial Crisis Miranda Xafa Hellenic Bank Association June 2009 1 I.I. EconomicEconomic andand financialfinancial developmentsdevelopments GlobalGlobal economyeconomy facesfaces itsits mostmost severesevere recessionrecession 2 sincesince WWIIWWII Real GDP Growth (Annual percent change) 10 Emerging and Developing economies 8 World 6 4 2 Advanced economies 0 -2 -4 1970 80 90 2000 10 3 Global outlook deteriorated sharply since October 08; modest turnaround expected with policy stimulus WEO Real GDP Growth Projections (In percent change from a year earlier) U.S. Euro Japan China India World 2009 (Apr. 09) -2.8 -4.2 -6.2 6.5 4.5 -1.3 2009 (Oct. 08) -0.7 -0.5 -0.2 8.5 6.3 2.2 Change -2.1 -1.5 -6.0 -2.0 -1.8 -3.5 2010 (Apr. 09) 0.0 -0.4 0.5 7.5 5.6 1.9 2010 (Oct. 08) 1.5 0.9 1.1 9.5 6.8 3.8 Change -1.5 -1.5 -0.6 -2.0 -1.2 -1.9 Source: IMF, World Economic Outlook, April 2009 Update. 4 Heightened uncertainty a defining feature of the crisis VIX and Standard Deviation of Forecasts (in percent) 1.2 70 VIX Index 60 1.0 (RHS) 50 0.8 U.S. Consensus Forecasts (STDEV; following 40 year; LHS) 0.6 30 0.4 20 0.2 10 Gulf Asian Crisis LTCM 9/11 War I Apr. 09 0.0 0 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 TentativeTentative signssigns ofof stabilizationstabilization emergedemerged 5 inin AprilApril--MayMay 2009...2009.. -
Measuring Sudden Stops in Mongolia
Munich Personal RePEc Archive Measuring Sudden Stops in Mongolia Batjargal, Dulamzaya and Doojav, Gan-Ochir The Bank of Mongolia June 2020 Online at https://mpra.ub.uni-muenchen.de/105115/ MPRA Paper No. 105115, posted 07 Jan 2021 10:44 UTC Measuring Sudden Stops in Mongolia Dulamzaya Batjargal1 Gan-Ochir Doojav2 Abstract In this paper, we empirically examine the sudden stops in capital flows in Mongolia based on Calvo et al. (2004) approach in the past two decades. We found 5 episodes of sudden stops in capital flows and 5 episodes of sudden stops in domestic credits since 1998. Domestic sudden stops lasted longer than the external sudden stop and, in most cases, external sudden stops are followed by the domestic sudden stops. The common consequences of sudden stops on the economy are reduced investments, slack in credits, economic slowdown, the exchange rate depreciation, decline in reserves, and banking crisis/difficulties. Keywords: Sudden stops, Capital flows, Exchange rate volatility, Mongolia JEL classification: F30, F32, F41 1 †Senior Economist at Monetary Policy Department, Bank of Mongolia Baga Toiruu 3, Ulaanbaatar 46, 15160, Mongolia (Email: [email protected]). 2 Gan-Ochir Doojav, Corresponding author, Chief Economist, Bank of Mongolia, Baga toiruu-3, Ulaanbaatar 46, 15160, Mongolia (Email: [email protected]). 1 1. Introduction A term “sudden stop” (SS) was first introduced by Dornbusch et al. (1995). It is an event characterized by an abrupt and large fall in capital inflows (or net flows) into the economy. Sudden stops have both financial and real effects on an economy. In the event of a sudden stop, the exchange rate depreciates, reserves decline, and equity prices fall. -
Anna Diamantopoulou
ANNA DIAMANTOPOULOU Greece’s candidate for the position of Secretary-General of the Organisation for Economic Co-operation and Development CURRICULUM VITAE AnnA DiAmAntOpOulOu is a Greek politician and public figure who has led a distinguished career in public service in Greece and in Europe. ms. Diamantopoulou was a European Commissioner for Employment, Social Affairs and Equal Opportunities, and has held several significant portfolios as a minister in the Greek government as well. She was minister of Development, Competitiveness and Shipping, and, prior to that, minister of Education, Research and technology, and lifelong learning. Her policy expertise and practice encompass a wide spectrum of areas: trade and industrial strategy, social insurance and social security systems, competitiveness and development, gender equality, education, and research-innovation and technology. more specifically, Anna Diamantopoulou has led work on the challenges and opportunities brought about by the Fourth industrial Revolution (it & Ai) at national and global levels. She also has considerable experience in the private and non-profit sectors. Z She is currently the President of DIKTIO – Network for Reform in Greece and Europe , a leading independent, non-partisan, Athens-based think tank, which she founded in 20 13. DiKtiO undertakes cutting-edge policy research, develops practical policy recommendations, and hosts high- level conferences, roundtables and lectures. DiKtiO’s research focuses on economic, social, and industrial policy reforms, while also producing important work on the impact of the Fourth industrial Revolution. As president and Founder of DiKtiO, Anna Diamantopoulou has overseen the organisation of more than 85 high-profile events as well as the publication of over a hundred policy and research papers. -
AFP Guide Negotiating and Complying with Credit Agreements
AFP Guide Negotiating and Complying with Credit Agreements In collaboration with AFP Guide Negotiating and Complying with Credit Agreements Contents Introduction 1 What’s Driving the Interest in Renegotiation 2 Sidebar: Factors Driving Interest in Renegotiation 2 Knowing When it’s Time to Renegotiate 3 Sidebars: What Internal Factors Spark a Renegotiation 3 Rethink the Bank Groups 3 Understanding the Risk-Reward Tradeoff 4 Sidebar: Where the Pushback Occurs 4 Meeting the Compliance Challenge 4 Sidebars: What to Do When Facing a Potential Violation 6 Compliance Takeaways 7 The Role of Lawyers 7 Conclusion and Best Practices 7 Case Studies 9 Greif, Inc. 9 Scotts Miracle Gro 10 Natural Resources 11 Company The Carlyle Group 12 Granite Construction 12 AFP Guide Negotiating and Complying with Credit Agreements AFP Guide Negotiating and Complying with Credit Agreements Introduction For many U.S. companies, the pressure is on to review and renegotiate their credit facilities. Here’s why: • Interest rates have already began to inch upward. • There’s rising demand for credit because of an M&A surge and relatively cheap debt. • Banks are readying themselves for the onset of Basel III capital and liquidity regulations. As a result, many practitioners report that their banks are urging them to review and potentially reopen credit facilities, even if they’re not due for some time, in order to lock in advantageous terms. Interviews with bankers, consultants, lawyers and many practitioners confirm this trend. While credit agreements are a perennial issue for treasurers, they are more top of mind now. As companies look to renegotiate existing agreements or put in place new ones, they need to keep certain things in mind. -
SUSTAINABLE Foundation Financial Results (Millions of Dollars) 2013 2012
2013 Annual Report CREATING A SUSTAINABLE FOunDatiON FINANCIAL Results (millions of dollars) 2013 2012 Revenues 3,752.8 3,624.3 Gross profit 868.8 846.3 (1) EBITDA from operations 284.4 289.4 (1) Adjusted operating cash flow before restructuring costs 207.6 200.4 (1) Adjusted operating cash flow after restructuring costs 192.3 190.4 Net earnings 52.7 90.0 Dividends 73.7 67.1 (dollar per basic share except shares outstanding) (1) EBITDA from operations 2.31 2.59 (1) Adjusted operating cash flow before restructuring costs 1.69 1.79 (1) Adjusted operating cash flow after restructuring costs 1.56 1.70 Net earnings 0.43 0.80 Dividends 0.60 0.60 Weighted average shares outstanding (millions) 123.1 111.9 FINANCIAL POSITION (millions of dollars) 2013 2012 Total assets 2,141.1 2,032.1 Total liabilities 1,600.9 1,657.7 Net capital expenditures 71.9 39.3 Acquisitions 11.9 5.5 (2) Senior debt 578.7 489.6 (2) Total debt 1,073.2 1,181.1 (3) Senior debt/Compliance EBITDA 2.2x 1.9x (3) Total debt/Compliance EBITDA before restructuring costs 3.9x 4.3x (3) Total debt/Compliance EBITDA after restructuring costs 4.1x 4.5x (1) Earnings before interest, taxes, depreciation and amortization (EBITDA), EBITDA from operations and adjusted operating cash flow (AOCF) are not recognized financial measures under International Financial Reporting Standards (IFRS). See Superior’s Management’s Discussion and Analysis, “Non-IFRS Financial Measures” for additional details. (2) Senior debt and total debt are stated before deferred issue costs. -
Birkbeck Institutional Research Online
View metadata, citation and similar papers at core.ac.uk brought to you by CORE provided by Birkbeck Institutional Research Online Birkbeck ePrints BIROn - Birkbeck Institutional Research Online Enabling open access to Birkbeck’s published research output The panhellenic Socialist movement and European integration: the primacy of the leader Book chapter (Author’s draft) http://eprints.bbk.ac.uk/5079 Citation: Dimitrakopoulos, D.; Passas, A.G. (2010) The panhellenic Socialist movement and European integration: the primacy of the leader In Dimitrakopoulos, D. (Ed.) - Social Democracy and European Integration: The Politics of Preference Formation (ISBN: 9780415559850) © 2010 Routledge Publisher Page ______________________________________________________________ All articles available through Birkbeck ePrints are protected by intellectual property law, including copyright law. Any use made of the contents should comply with the relevant law. ______________________________________________________________ Deposit Guide Contact: [email protected] Published in Social Democracy and European Integration: The Politics of Preference Formation, edited by D. G. Dimitrakopoulos, 117-156. London/New York: Routledge, 2010. 4 The Panhellenic Socialist Movement and European Integration: The Primacy of the Leader Dionyssis G. Dimitrakopoulos and Argyris G. Passas Introduction1 This chapter focuses on the Panhellenic Socialist Movement (PASOK) and seeks to trace the origin and the content of its preferences on European integration since its establishment in 1974. It challenges the established view that – couched as it is in PASOK’s rhetoric in the immediate post-1974 era – construes PASOK as an initially instinctively anti-European political party that subsequently performed a policy U- turn, a true political transformation by turning from a vocal anti-EEC stance to a pro- European (even federalist) attitude (Tsardanidis 1998, 295, 299, 300; Kazakos 1994, 5; Verney 1987, 259-60, 263; Featherstone 1988, 178; Couloumbis 1993, 126; Featherstone 1994, 158-9). -
The Day After
THE DAY AFTER DELPHI ECONOMIC FORUM V | DIGITAL DRAFT AGENDA TUESDAY-FRIDAY, JUNE 9-12, 2020 DAY 1 | TUESDAY, JUNE 9, 2020 12.30 OPENING ADDRESS Her Excellency the President of the Hellenic Republic Katerina Sakellaropoulou 12.45 BREAK 12.50 OPENING REMARKS Rector Hélène Ahrweiler, President, Administration Council, European Cultural Centre of Delphi 13.00 THERMOPYLAE AND SALAMIS: THE TRIUMPH OF WILL Marianna V. Vardinoyannis, Goodwill Ambassador, UNESCO Rector Hélène Ahrweiler, President, Administration Council, European Cultural Centre of Delphi, Greece Chair: Antonis Sroiter, Anchorman, Alpha TV, Greece 13.25 BREAK 13.30 KEYNOTE SPEECH Stella Kyriakides, Commissioner for Health and Food Safety, European Commission 14.00 BREAK 1 Confirmed Speakers DAY 1 | TUESDAY, JUNE 9, 2020 14.05 FIRESIDE CHAT I Vassilis Kikilias, Minister of Health, Hellenic Republic Chair: Dora Anagnostopoulou, Anchorwoman, MEGA TV 14.20 BREAK 14.25 FIRESIDE CHAT II Sotiris Tsiodras, Professor of Epidemiology, Health Ministry’s spokesperson Chair: Symeon G. Tsomokos, Delphi Economic Forum 14.40 BREAK 14.45 Dolores Monserrat, Minister of Health (2016-2018), Spain 15.00 BREAK 15.05 CEO TALK Theodoros Tryfon, Co/CEO, ELPEN Group; President, Panhellenic Union of Pharmaceutical Industries, Greece 15.10 BREAK 15.15 PREPARING FOR THE SECOND WAVE Panagiotis Arkoumaneas, President, National Public Health Organization (EODY) Athanasios-Meletios Dimopoulos, Rector, National and Kapodistrian University of Athens Yannis Tountas, Professor of Social and Preventive Medicine, -
Causes and Consequenses of the Recent Crises
2 Causes and Consequences of the Recent Crises It is impossible to explain the evolution of the architecture exercise without first examining the emerging-market crises of the 1990s, especially the Mexican and Asian crises, with particular attention to the explanations given for them and the responses of the international community. Others have already reviewed those crises in detail;1 this chapter focuses on the features that set them apart from earlier currency crises and on the unusual nature of the official response. As both crises began when large capital inflows came to a sudden stop and gave way to large capital outflows, this chapter starts by asking why emerging-market countries started to experience large capital inflows in the early 1990s. It then examines the policy problems posed by those inflows—the macroeconomic problems that used to be the main focus of concern, and the microeconomic problems that help explain the vulnera- bility of the Asian countries and the virulence of the Asian crisis. The chapter then turns to the Mexican crisis to ask how it began, what might have been done to contain it, and why it was transformed from a currency crisis into a sovereign debt crisis. Although the Mexican crisis had some unusual features and the official response to the crisis was controversial, there was comparatively little debate about the causes of the crisis and no perceived need for a new set of currency-crisis models to explain the onset of the crisis.2 1. On Mexico, see IMF (1995), Edwards (1997), and Boughton (2000); on Asia, see IMF (1997b, 1998b, 1998c, 1998d), Bosworth (1998), and Eichengreen (1999a, appendix C).