Carmen Reinhart presents on the challenges of high debt levels in advanced economies following the global financial crisis. Some key points:
1) Advanced economies continue to struggle with public and private debt overhangs, lower growth, high unemployment, and weak deleveraging since the crisis.
2) Financial repression, including directed lending to governments, interest rate caps, and tighter bank regulation, is re-emerging as a tool to reduce debt burdens following large debt accumulations.
3) Debt relief in past crises has occurred through economic growth, austerity, default/restructuring, inflation, or sustained financial repression combined with inflation - but these options are difficult for advanced economies currently facing high debt
Eurozone Crisis : A case study on GreeceAniket Pant
Our group was required to do a presentation for Financial Management on the Euro Zone Crisis. We took the example of Greece and did the study. Here are our slides.
Eurozone Crisis : A case study on GreeceAniket Pant
Our group was required to do a presentation for Financial Management on the Euro Zone Crisis. We took the example of Greece and did the study. Here are our slides.
For anyone who does not want to be reduced to a Greece- like situation, these are learning times. Be disciplined in money matters,
tighten your belts
Greece and its European creditors announced an agreement in Brussels on Monday that aims to resolve the country’s debt crisis and keep it in the eurozone, but that will require further budgetary belt-tightening that Prime Minister Alexis Tsipras could have trouble selling back in Athens.
The International Monetary Fund threatened to withdraw support for Greece’s bailout on Tuesday unless European leaders agree to substantial debt relief.
The Greek Parliament has scheduled a vote for Wednesday night on whether to approve central elements of the deal.
The Greek government-debt crisis was the sovereign debt crisis faced by Greece in the aftermath of the financial crisis of 2007–08. Widely known in the country as The Crisis (Greek: Η Κρίση), it reached the populace as a series of sudden reforms and austerity measures that led to impoverishment and loss of income and property, as well as a small-scale humanitarian crisis.[6][7] In all, the Greek economy suffered the longest recession of any advanced mixed economy to date, overtaking the US Great Depression. As a result, the Greek political system has been upended, social exclusion increased, and hundreds of thousands of well-educated Greeks have left the country
The Greek government crisis (also known as the Greek depression) started in late 2009. It was the first sovereign debt crisis in the Eurozone later referred to collectively as the European debt crisis.
In 2012, Greece's government had the largest sovereign debt default in history.
On June 30, 2015, Greece became the first developed country to fail to make an IMF loan repayment. At that time, Greece's government had debts of €323bn.
Greece government debt crisis -cause, result and effect kasaken
I made this when I was in Canada as study abroad. I took business management course in KGIBC for 6 module. I learned business manner, economics, accounting, etc. Every modules had presentation, quiz and test. This is the one of presentation I had. thanks,
Project on Greece Crisis and Impact for Economic Environment of Business Renzil D'cruz
: Project on Greece Crisis and Impact for Economic Environment of Business
• financial crisis of 2007–2008
• Greek government-debt crisis
• Causes for deteriorated economic
• Tax evasion and corruption
• Unsustainable and accelerating debt-to-GDP ratios
• Impact of the Greece Economic Crisis on India
India’s Crisis Responses and Challenges
Project on Greece Crisis and Impact for Economic Environment of Business Renzil D'cruz
: Project on Greece Crisis and Impact for Economic Environment of Business
• financial crisis of 2007–2008
• Greek government-debt crisis
• Causes for deteriorated economic
• Tax evasion and corruption
• Unsustainable and accelerating debt-to-GDP ratios
• Impact of the Greece Economic Crisis on India
India’s Crisis Responses and Challenges
This presentation explores the causes of the European debt crisis, timeline of the crisis, its extent, how it is being addressed, who is to blamed for the crisis and how it affects us.
Previsiones del cuadro macro completo y del empleo por sectores de la economía vasca para el IT2013, basadas en un modelo de series de alta frecuencia diseñado por CEPREDE
For anyone who does not want to be reduced to a Greece- like situation, these are learning times. Be disciplined in money matters,
tighten your belts
Greece and its European creditors announced an agreement in Brussels on Monday that aims to resolve the country’s debt crisis and keep it in the eurozone, but that will require further budgetary belt-tightening that Prime Minister Alexis Tsipras could have trouble selling back in Athens.
The International Monetary Fund threatened to withdraw support for Greece’s bailout on Tuesday unless European leaders agree to substantial debt relief.
The Greek Parliament has scheduled a vote for Wednesday night on whether to approve central elements of the deal.
The Greek government-debt crisis was the sovereign debt crisis faced by Greece in the aftermath of the financial crisis of 2007–08. Widely known in the country as The Crisis (Greek: Η Κρίση), it reached the populace as a series of sudden reforms and austerity measures that led to impoverishment and loss of income and property, as well as a small-scale humanitarian crisis.[6][7] In all, the Greek economy suffered the longest recession of any advanced mixed economy to date, overtaking the US Great Depression. As a result, the Greek political system has been upended, social exclusion increased, and hundreds of thousands of well-educated Greeks have left the country
The Greek government crisis (also known as the Greek depression) started in late 2009. It was the first sovereign debt crisis in the Eurozone later referred to collectively as the European debt crisis.
In 2012, Greece's government had the largest sovereign debt default in history.
On June 30, 2015, Greece became the first developed country to fail to make an IMF loan repayment. At that time, Greece's government had debts of €323bn.
Greece government debt crisis -cause, result and effect kasaken
I made this when I was in Canada as study abroad. I took business management course in KGIBC for 6 module. I learned business manner, economics, accounting, etc. Every modules had presentation, quiz and test. This is the one of presentation I had. thanks,
Project on Greece Crisis and Impact for Economic Environment of Business Renzil D'cruz
: Project on Greece Crisis and Impact for Economic Environment of Business
• financial crisis of 2007–2008
• Greek government-debt crisis
• Causes for deteriorated economic
• Tax evasion and corruption
• Unsustainable and accelerating debt-to-GDP ratios
• Impact of the Greece Economic Crisis on India
India’s Crisis Responses and Challenges
Project on Greece Crisis and Impact for Economic Environment of Business Renzil D'cruz
: Project on Greece Crisis and Impact for Economic Environment of Business
• financial crisis of 2007–2008
• Greek government-debt crisis
• Causes for deteriorated economic
• Tax evasion and corruption
• Unsustainable and accelerating debt-to-GDP ratios
• Impact of the Greece Economic Crisis on India
India’s Crisis Responses and Challenges
This presentation explores the causes of the European debt crisis, timeline of the crisis, its extent, how it is being addressed, who is to blamed for the crisis and how it affects us.
Previsiones del cuadro macro completo y del empleo por sectores de la economía vasca para el IT2013, basadas en un modelo de series de alta frecuencia diseñado por CEPREDE
arifanee.com is world's leading website on the hottest financial news, perspectives and behind the scenes stories. arifanees.com brings you insight and information to inspire and transform your paradigm by enriching your with the best of facts and the vision.
arifanees.com
Information-Inspiration-Transformation
arifanee.com is world's leading website on the hottest financial news, perspectives and behind the scenes stories. arifanees.com brings you insight and information to inspire and transform your paradigm by enriching your with the best of facts and the vision.
arifanees.com
Information-Inspiration-Transformation
As the global financial crisis entered its most dramatic phase, in the second half of 2008, the International Monetary Fund (IMF), many governments and several distinguished scholars advocated expansionary fiscal olicy as the second most effective tool (after monetary stimulus) to fight deep recession and deflation. Now, more than a year later, the previous excitement surrounding the supposed power of fiscal stimulus largely disappeared and instead has been replaced by ising concerns over the sustainability of public finances in many countries. Unfortunately, the previous enthusiasts of the active counter‐cyclical fiscal policy have not always realized the causality between the two.
Authored by: Marek Dąbrowski
Published in 2009
Andrés Solimano, President and Founder of the International Center for Globalization and Development, presented on the history of recessions in the 20th century on 11 June 2019 at the OECD Development Centre for their "DEV Talks" series.
Ivo Pezzuto - World Economy. Resilience or Great Reset (The Global Analyst ma...Dr. Ivo Pezzuto
The Covid-19 pandemic, like other previous crises, will certainly leave lasting economic scars around the world in the years to come, but hopefully, it will also become the catalyst of a brighter and more sustainable future, thanks to the acceleration of industries’ transformation, digitalization, consolidation, reconfiguration of supply chains, productivity enhancements, and invention of new business models. The article aims to explore some of the greatest challenges facing the world economy in the post-COVID-19 era and the major casualties and potential risks related to dramatic externality.
The article also aims to highlight unique and specific fragilities at the onset of this pandemic crisis and the urgent need to address them in order to make the world economy more resilient.
how to sell pi coins at high rate quickly.DOT TECH
Where can I sell my pi coins at a high rate.
Pi is not launched yet on any exchange. But one can easily sell his or her pi coins to investors who want to hold pi till mainnet launch.
This means crypto whales want to hold pi. And you can get a good rate for selling pi to them. I will leave the telegram contact of my personal pi vendor below.
A vendor is someone who buys from a miner and resell it to a holder or crypto whale.
Here is the telegram contact of my vendor:
@Pi_vendor_247
where can I find a legit pi merchant onlineDOT TECH
Yes. This is very easy what you need is a recommendation from someone who has successfully traded pi coins before with a merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi network coins and resell them to Investors looking forward to hold thousands of pi coins before the open mainnet.
I will leave the telegram contact of my personal pi merchant to trade with
@Pi_vendor_247
Exploring Abhay Bhutada’s Views After Poonawalla Fincorp’s Collaboration With...beulahfernandes8
The financial landscape in India has witnessed a significant development with the recent collaboration between Poonawalla Fincorp and IndusInd Bank.
The launch of the co-branded credit card, the IndusInd Bank Poonawalla Fincorp eLITE RuPay Platinum Credit Card, marks a major milestone for both entities.
This strategic move aims to redefine and elevate the banking experience for customers.
Financial Assets: Debit vs Equity Securities.pptxWrito-Finance
financial assets represent claim for future benefit or cash. Financial assets are formed by establishing contracts between participants. These financial assets are used for collection of huge amounts of money for business purposes.
Two major Types: Debt Securities and Equity Securities.
Debt Securities are Also known as fixed-income securities or instruments. The type of assets is formed by establishing contracts between investor and issuer of the asset.
• The first type of Debit securities is BONDS. Bonds are issued by corporations and government (both local and national government).
• The second important type of Debit security is NOTES. Apart from similarities associated with notes and bonds, notes have shorter term maturity.
• The 3rd important type of Debit security is TRESURY BILLS. These securities have short-term ranging from three months, six months, and one year. Issuer of such securities are governments.
• Above discussed debit securities are mostly issued by governments and corporations. CERTIFICATE OF DEPOSITS CDs are issued by Banks and Financial Institutions. Risk factor associated with CDs gets reduced when issued by reputable institutions or Banks.
Following are the risk attached with debt securities: Credit risk, interest rate risk and currency risk
There are no fixed maturity dates in such securities, and asset’s value is determined by company’s performance. There are two major types of equity securities: common stock and preferred stock.
Common Stock: These are simple equity securities and bear no complexities which the preferred stock bears. Holders of such securities or instrument have the voting rights when it comes to select the company’s board of director or the business decisions to be made.
Preferred Stock: Preferred stocks are sometime referred to as hybrid securities, because it contains elements of both debit security and equity security. Preferred stock confers ownership rights to security holder that is why it is equity instrument
<a href="https://www.writofinance.com/equity-securities-features-types-risk/" >Equity securities </a> as a whole is used for capital funding for companies. Companies have multiple expenses to cover. Potential growth of company is required in competitive market. So, these securities are used for capital generation, and then uses it for company’s growth.
Concluding remarks
Both are employed in business. Businesses are often established through debit securities, then what is the need for equity securities. Companies have to cover multiple expenses and expansion of business. They can also use equity instruments for repayment of debits. So, there are multiple uses for securities. As an investor, you need tools for analysis. Investment decisions are made by carefully analyzing the market. For better analysis of the stock market, investors often employ financial analysis of companies.
Currently pi network is not tradable on binance or any other exchange because we are still in the enclosed mainnet.
Right now the only way to sell pi coins is by trading with a verified merchant.
What is a pi merchant?
A pi merchant is someone verified by pi network team and allowed to barter pi coins for goods and services.
Since pi network is not doing any pre-sale The only way exchanges like binance/huobi or crypto whales can get pi is by buying from miners. And a merchant stands in between the exchanges and the miners.
I will leave the telegram contact of my personal pi merchant. I and my friends has traded more than 6000pi coins successfully
Tele-gram
@Pi_vendor_247
how to sell pi coins in all Africa Countries.DOT TECH
Yes. You can sell your pi network for other cryptocurrencies like Bitcoin, usdt , Ethereum and other currencies And this is done easily with the help from a pi merchant.
What is a pi merchant ?
Since pi is not launched yet in any exchange. The only way you can sell right now is through merchants.
A verified Pi merchant is someone who buys pi network coins from miners and resell them to investors looking forward to hold massive quantities of pi coins before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
how can I sell pi coins after successfully completing KYCDOT TECH
Pi coins is not launched yet in any exchange 💱 this means it's not swappable, the current pi displaying on coin market cap is the iou version of pi. And you can learn all about that on my previous post.
RIGHT NOW THE ONLY WAY you can sell pi coins is through verified pi merchants. A pi merchant is someone who buys pi coins and resell them to exchanges and crypto whales. Looking forward to hold massive quantities of pi coins before the mainnet launch.
This is because pi network is not doing any pre-sale or ico offerings, the only way to get my coins is from buying from miners. So a merchant facilitates the transactions between the miners and these exchanges holding pi.
I and my friends has sold more than 6000 pi coins successfully with this method. I will be happy to share the contact of my personal pi merchant. The one i trade with, if you have your own merchant you can trade with them. For those who are new.
Message: @Pi_vendor_247 on telegram.
I wouldn't advise you selling all percentage of the pi coins. Leave at least a before so its a win win during open mainnet. Have a nice day pioneers ♥️
#kyc #mainnet #picoins #pi #sellpi #piwallet
#pinetwork
Turin Startup Ecosystem 2024 - Ricerca sulle Startup e il Sistema dell'Innov...Quotidiano Piemontese
Turin Startup Ecosystem 2024
Una ricerca de il Club degli Investitori, in collaborazione con ToTeM Torino Tech Map e con il supporto della ESCP Business School e di Growth Capital
Poonawalla Fincorp and IndusInd Bank Introduce New Co-Branded Credit Cardnickysharmasucks
The unveiling of the IndusInd Bank Poonawalla Fincorp eLITE RuPay Platinum Credit Card marks a notable milestone in the Indian financial landscape, showcasing a successful partnership between two leading institutions, Poonawalla Fincorp and IndusInd Bank. This co-branded credit card not only offers users a plethora of benefits but also reflects a commitment to innovation and adaptation. With a focus on providing value-driven and customer-centric solutions, this launch represents more than just a new product—it signifies a step towards redefining the banking experience for millions. Promising convenience, rewards, and a touch of luxury in everyday financial transactions, this collaboration aims to cater to the evolving needs of customers and set new standards in the industry.
how to sell pi coins in South Korea profitably.DOT TECH
Yes. You can sell your pi network coins in South Korea or any other country, by finding a verified pi merchant
What is a verified pi merchant?
Since pi network is not launched yet on any exchange, the only way you can sell pi coins is by selling to a verified pi merchant, and this is because pi network is not launched yet on any exchange and no pre-sale or ico offerings Is done on pi.
Since there is no pre-sale, the only way exchanges can get pi is by buying from miners. So a pi merchant facilitates these transactions by acting as a bridge for both transactions.
How can i find a pi vendor/merchant?
Well for those who haven't traded with a pi merchant or who don't already have one. I will leave the telegram id of my personal pi merchant who i trade pi with.
Tele gram: @Pi_vendor_247
#pi #sell #nigeria #pinetwork #picoins #sellpi #Nigerian #tradepi #pinetworkcoins #sellmypi
Even tho Pi network is not listed on any exchange yet.
Buying/Selling or investing in pi network coins is highly possible through the help of vendors. You can buy from vendors[ buy directly from the pi network miners and resell it]. I will leave the telegram contact of my personal vendor.
@Pi_vendor_247
If you are looking for a pi coin investor. Then look no further because I have the right one he is a pi vendor (he buy and resell to whales in China). I met him on a crypto conference and ever since I and my friends have sold more than 10k pi coins to him And he bought all and still want more. I will drop his telegram handle below just send him a message.
@Pi_vendor_247
The Evolution of Non-Banking Financial Companies (NBFCs) in India: Challenges...beulahfernandes8
Role in Financial System
NBFCs are critical in bridging the financial inclusion gap.
They provide specialized financial services that cater to segments often neglected by traditional banks.
Economic Impact
NBFCs contribute significantly to India's GDP.
They support sectors like micro, small, and medium enterprises (MSMEs), housing finance, and personal loans.
How to get verified on Coinbase Account?_.docxBuy bitget
t's important to note that buying verified Coinbase accounts is not recommended and may violate Coinbase's terms of service. Instead of searching to "buy verified Coinbase accounts," follow the proper steps to verify your own account to ensure compliance and security.
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
1. A Decade of Debt
Carmen M. Reinhart
Harvard University
Universidad del País Vasco
November 15, 2013
2. The challenges of global setting
in the sixth year after the crisis
The advanced economies: Public and
private debt overhang, deleveraging, lower
growth and persistent high unemployment
The emerging markets: Large capital inflows
and their recent reversals, inflationary
pressures, bubble and crisis risks
Reinhart
3. Preamble and definition:
Financial repression
… includes directed lending to government
by captive domestic audiences (such as
pension funds), explicit or implicit caps on
interest rates, heavier regulation (including
of cross-border capital movements, i.e.
capital controls), and (generally) a tighter
connection between government and banks.
It is a tax on bondholders and more generally
savers…
Reinhart
3
5. Banking Crises, Financial Globalization
and Its Reversals: 1870-2013
High 1
0.9
1931
30.00
1914
2006
0.8
WWI
capital
controls
0.7
Share of Countries
Banking Crisisfirst year
3-year Sum
(right scale)
Crisis,
depression
and WWII
25.00
2013
20.00
Percent
0.6
Index
35.00
The Great Globalization
Gold Standard--heyday of
financial globalization
0.5
The era of
financial repression
0.4
15.00
1980
0.3
10.00
Capital Mobility
0 to 1 Index
(left scale)
0.2
5.00
1945
0.1
1918
Low 0
0.00
1870
1880
1890
1900
1910
1920
1930
1940
Reinhart
1950
1960
1970
1980
1990
2000
2010
6. Where are the advanced
economies in the current
conjuncture?
Reinhart
7. Real per capita GDP growth
Real per capita GDP growth rates are
significantly lower during the decade
following severe financial crises and the
synchronous world-wide shocks.
The median post-financial crisis GDP
growth decline in advanced economies is
about 1 percent.
(from about 3.1 to 2.1 percent per annum)
Reinhart
7
8. In 7 of 15 episodes there was a
double dip
Reinhart
8
9. Unemployment rates
In the ten-year window following severe
financial crises, unemployment rates are
significantly higher than in the decade that
preceded the crisis.
The rise in unemployment is most marked for
the five advanced economies, where the
median unemployment rate is about 5
percentage points higher.
(from 2.7 to 7.9 percent)
Reinhart
9
10. Unemployment Rate in the Decade Before and the
Decade After Severe Financial Crises: Post-WWII,
Advanced Economies
Probability density function, five advanced economies
Big five: Spain, 1977; Norway, 1987;
Finland, 1991; Sweden, 1991, Japan 1992
t-10 to t-1 t+1 to t+10
median
2.7
7.9
min
1.1
2.5
max
6.1
21.2
obs.
50
50
50
45
Pre-crisis, (t-10 to t-1)
40
35
30
25
20
15
Post-crisis (t+1 to t+10)
10
5
0
1
3
4
6
7
9
10
12
13
15
16
18
19
21
22
Unemployment rate, percent
Reinhart
10
11. In ten of the fifteen post-crisis episodes,
unemployment has not fallen back to its
pre-crisis level, not in the decade that
followed…
This was also the case for past systemic
crises in the US.
Reinhart
11
12. Post 2008 is the third peak in
public debt—the two previous
episodes (especially post WWII)
were marked by a lengthy
period of negative interest rates.
13. Public debt as a percent of GDP:
Advanced Economies: 1900-2013
100
90
Unweighted Average
Advanced economies
80
70
60
50
40
30
20
10
0
1900
1910
1920
1930
1940
1950
1960
Reinhart
1970
1980
1990
2000
2010
14. Gross external total debt (public
plus private) is in uncharted
territory….deleveraging,
especially in Europe, has been
halting.
For a contrast in external
deleveraging—see post crisis Asia
Reinhart
15. Gross Total (Public plus Private) External Debt as a
Percent of GDP: 22 Advanced and 25 Emerging
Market Economies, 1970-2013:Q1
300
250
Unweighted Average
Advanced Economies
200
150
100
50
0
1970 1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009 2012
Reinhart
15
16. External Total (Public plus Private) External Debt:
Six Asian Economies, 1970-2013:Q1
(percent of GDP)
Percent
85
Average for India, Indonesia,
Korea, Malaysia, Philippines,
and Thailand
75
65
55
45
35
25
Banking crises in at least three
countries (shaded)
15
1970
1975
1980
1985
1990
1995
2000
2005
2010
Sources: International Monetary Fund, World Economic Outlook, Reinhart and Rogoff (2009), Reinhart (2010), World Bank
Reinhart
(2013), International Debt Statistics, Washington DC http://data.worldbank.org/data-catalog/international-debt-statistics,
18. Private Domestic Credit as a Percent of GDP:
Advanced Economies, 1950-2013: August
180
Unweighted Average
Advanced Economies
160
140
120
100
80
60
40
1950 1954 1958 1962 1966 1970 1974 1978 1982 1986 1990 1994 1998 2002 2006 2010
Reinhart
18
19. Domestic Credit to the Private
Sector, Six Asian Economies 1955-2013:Q2
(as a percent of GDP)
Percent
135
115
95
75
Average for India, Indonesia,
Korea, Malaysia, Philippines,
and Thailand
55
Banking crises in at least three
countries (shaded)
35
15
1955
1960
1965
1970
1975
1980
1985
Reinhart
1990
1995
2000
2005
2010
20. Throughout history, debt/GDP ratios have been
reduced by:
(i) economic growth;
(ii) fiscal adjustment/austerity;
(iii) explicit default or restructuring;
(iv) a sudden surprise burst in inflation; and
(v) a steady dosage of financial repression that is
accompanied by an equally steady dosage of
inflation.
(Options (iv) and (v) are only viable for domesticcurrency debts).
Reinhart
21. The first of these is relatively
rare and the rest are difficult.
Reinhart
22. Crisis Resolution: How different are
advanced economies and emerging
markets???
Not as much as widely believed.
There is an extensive “forgotten”
history of pre-WWII credit events
in advanced economies (default,
restructurings, conversions and
other forms of confiscation…)
Reinhart
25. Financial repression as a tool for
public debt reduction
In the heavily regulated financial markets of
the Bretton Woods, restrictions facilitated a
sharp and rapid reduction in public
debt/GDP ratios from the late 1940s to the
1970s.
Low nominal interest rates reduced debt
servicing costs while a high incidence of
negative real interest rates liquidated the
real value of government debt.
Reinhart
25
27. Official Holdings of United States Marketable
Treasury Debt, 1945-2013:Q2
(as a percent of total marketable debt outstanding)
Percent
60
Share of Marketable
Treasury Securities held
by All Official
Institutions
50
40
30
The difference between
Total and Foreign is the
Share Held by the
Federal Reserve
20
10
Share of "Marketable Treasury
Securities Held by Foreign Official Intitutions
(i.e. central banks)
0
1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010
Reinhart
28. The Re-emergence of Financial Repression, 2008-2011
France, December 2010: Liquidation of Fonds de Reserve Pour Les Retraites (FFR) The French
government changed the law to shift the €37bn FFR from providing long-term financial support to the
French PAYG pension system after 2020 to instead pay an annual €2.1bn to the Caisse d’Amortissement de
la Dette Sociale (CADES) from 2011 to 2024 and at that point transfer all remaining assets to the CADES
in one lump-sum payment. This shift in FFR’s investment horizon has meant a radical shift in asset
allocation from longer-term diversified riskier assets to a short-term LDI-strategy dominated by liability
matching short-term French government bonds. For the duration of its lifespan the FRR has consequently
been transformed into a large captive buyer of French government bonds.
Ireland, 2010: Use of the National Pension Reserve Fund to Recapitalize Banks As a result of the banking
crisis, Ireland National Pension Reserve Fund (NPRF) may have to contribute up to €17.5bn to recapitalize
Ireland’s banks. The NPRF was originally set up in 2001 to help finance the long-term costs of Ireland's
social welfare and public service pensions from 2025 onwards. However, a 2010 law directed the NPRF to
invest in Irish government securities and provides the legal authority for the Irish government to fund
capital expenditure from the NPRF from 2011-2013.
April 2011: Levy on pension funds. The Irish government has further recently suggested to fund job
creation schemes through a special 0.5% levy on private pension funds.
Japan, March 2010: Reversal of Post Privatization and Raising of Deposit Ceiling The new DPJ
government reversed the 2007 plan to privatize Japan Post, the world’s largest financial conglomerate with
more than ¥300tr in assets. Crucially, the DPJ government with the new law also doubled the deposit cap at
Japan Post Bank to ¥20mn and raised the life insurance coverage limit at Japan Post Insurance Co. from
¥13mn to ¥25mn. Given Japan Post’s traditional roughly 75 percent asset allocation to JGBs, and under the
assumption that consumers will transfer deposits to a company certain to enjoy a government guarantee, the
reversal of the Japan Post privatization provides additional incentives to a captive customer of Japanese
government debt.
Reinhart
29. Portugal, 2010: The transfer of the previously privatized Portugal Telecom pension scheme back to the
Portuguese government, which in the process immediately booked €2.8bn (1.6% of GDP) in extra
revenues. This enabled the Portuguese government to improve its budget deficit in 2010 sufficiently
to cosmetically appear to be in line with annual EU deficit reduction targets.
Spain, April 2010: Interest rate ceilings on deposits. The Ministry of Finance (MoF) requires that
institutions offering deposit interest rates that are considered to be above market rates (determined
by MoF) double their contributions to the Fondo de Garantía de Depósitos.
UK, October 2009, UK Financial Services Authority (FSA) puts a global regulatory liquidity marker. The
proposal by the FSA requires UK banks, investment banks, and subsidiaries or branches of foreign
banks operating in the London market to hold more high quality government securities—at least
around ₤110 billion more (at that time), and cut their reliance on short-term funding by 20 percent
in the first year alone.
2011? Royal Mail privatization, which will see an expected £23.5bn in assets transferred to the UK
treasury ahead of privatization (as well as an expected £29.5bn in liabilities).
Reinhart
30. Fed proposes new liquidity rules
for banks
October 24, 2013
Reinhart
31. In emerging markets, financial
repression has been manifested in
steadily rising reserve requirements
(to sterilize inflows) and “prudential
measures” to reduce inflows.
Controls on outflows have just
begun to re-emerge…
Reinhart