Financial crisis
Weak US productivity behind low wage growth – IMF
Declining labour share of income is another contributing factor
ECB needed better data in 2008 crisis, says Lautenschläger
Money market data was “limited” and published too infrequently, says senior ECB official
Competitive housing markets fostered risk taking before crisis – IMF research
In areas with higher price volatility institutions lowered lending standards
New Zealand’s main banks pass stress tests
Tests cover wider range of risks, including concentration and misconduct risks
Book notes: Unfinished business, by Tamim Bayoumi
Anand Sinha praises Bayoumi’s analysis of how the euro crisis and US housing crash were, in fact, intertwined
Higher capital ratios trade growth for stability – Philadelphia Fed paper
Better capitalised banks reduce lending rates, researcher says
European banking union insufficient to withstand next crisis – Portuguese governor
Common supervisory and resolution tools are in place, but Europe lacks a deposit insurance scheme
Miles warns too much weight placed on untried regulations
TLAC and the resolution regime may not be enough to substitute for higher capital, former Bank of England official says
Book notes: China’s Great Wall of Debt, by Dinny McMahon
McMahon is too pessimistic about the chances of China managing to get its great wall of debt under control, writes Michael Taylor, but he is undoubtedly right about the scale of the challenge
NY Fed research ‘stress tests’ household balance sheets
Authors say it is “crucial” to track household leverage; vulnerability in the US “remains elevated”
Fed’s Quarles defends FSB from US critics
Supervision chief says FSB is not a threat to sovereignty and helps solve collective problems
Eurozone requires both banking and capital markets union – panellists
Status quo is highly procyclical and hampers risk sharing, IMF conference hears
Eurozone governments’ post-crisis fiscal policies were ‘self-defeating’
Policies ended up being contractionary, IMF-organised conference hears
Money matters for macro fluctuations – Fed paper
Working paper says previous research by Schularick and Taylor may have been flawed
Issuing “foreign-law” debt can cut costs in times of crisis – ECB paper
Eurozone countries’ bonds issued abroad showed major premiums during debt crisis – researchers
‘Living wills’ have reduced implicit subsidy – Fed paper
Higher cost of capital implies resolution measures have reduced ‘too big to fail’ subsidy, authors say
Fed paper questions value of debt as crisis indicator
Asset prices and current account balance more important, author finds
Italy’s trial
Francesco Papadia argues Italy is likely to suffer financial and economic damage under its new political leadership, but will still not leave the euro
BoE paper models bank runs in general equilibrium
Daisuke Ikeda finds regulations must be comprehensive to prevent risk shifting
BIS authors document ‘significant’ shifts in CDS risks
Credit default swaps market has changed “markedly” since 2008, authors say
Book notes: Edge of chaos, by Dambisa Moyo
John Chown applauds Moyo’s analysis of how the current democratic framework is failing
Resolution still essential for CCPs – BoE’s Cunliffe
Despite high loss absorbency, CCPs still need a resolution framework, deputy governor says
Switzerland weighs bold monetary experiment
On June 10, Switzerland will vote on whether to revolutionise its monetary system and hand the central bank a monopoly on money creation
Is the US dismantling Dodd-Frank?
Richard Heckinger asks whether recent amendments to the Dodd-Frank Act amount to technical tweaks or full-scale rollback