Financial crisis
Financial crisis hit Australian inventories, paper finds
RBA researcher tests theory that tight credit conditions caused Australian companies to reduce their inventories, and includes a case study on the automotive industry supporting the hypothesis
National Bank of Denmark winds up emergency lending measures
Six-month loans against a broad range of collateral introduced during the financial crisis will be terminated next year as normality returns to financial sector, central bank says
NY Fed vice-president on the evolution of Fed monetary operations
Simon Potter says the Fed has 'developed and tested' many different monetary policy tools since the crisis, including term and overnight reverse repos 'diverting deposits from banks'
OECD’s William White fears global economic system is still highly unstable
William White tells Christopher Jeffery he is wary of placing too much reliance on the ‘science’ of monetary or regulatory policy. He also believes the world economic system is still out of balance
Riksbank policy-makers differ 'fundamentally' on role of central bank, says deputy governor
Sveriges Riksbank deputy says policy approach is marginally beneficial at best and risks undermining 'public confidence' in central bank's targeting of inflation
Crisis a 'classic panic' in novel institutional context, says Bernanke
Speaking at the IMF annual research conference in DC, Fed chair warns of moral hazard arising from actions to limit crisis early on; outlines US long-term measures aimed at curbing such externalities
UBS buys back ‘bad bank' from Swiss central bank
Switzerland's biggest bank is reacquiring vehicle set up by the Swiss National Bank in 2008 to relieve it of illiquid assets and save it from potential collapse; Deal earns SNB $3.8 billion in profit
RBI tries to persuade foreign banks to put down roots
Revamped framework unveiled by India's central bank yesterday will make it easier for foreign lenders currently operating through branches to set up wholly owned subsidiaries in the country
IMF's Lipton says Germany faces grave risks from global 'mismanagement'
Fund's first deputy managing director pleads with European powerhouse to 'lift its sights to the global horizon as well' as it carries on the work of the European project
Leading central banks make emergency swap lines permanent
Six leading central banks are leaving bilateral swap agreements introduced during the financial crisis in place until further notice; US dollar liquidity-providing operations will continue as normal
RBI paper finds Indian banks were not spared by financial crisis
Working paper says that despite the global financial crisis being concentrated in advanced economies, weaker Indian banks saw their margins ‘impaired significantly’
Danish central bank to cut workforce by 10%
National Bank of Denmark to lay off 55 employees as it adjusts to post-crisis environment and introduces new IT system that makes some jobs obsolete
External balance-sheet structure key in explaining the financial crisis
High gross external debt was indicator of subsequent vulnerability, according to BoE paper; finds ‘important interaction' between 'competing ‘savings glut' and ‘banking glut' hypotheses
Mix of micro and macro indicators improves chances of spotting bank distress early on
ECB working paper presents ‘early warning model' using bank and country-level data for predicting individual bank distress in Europe
Trust in financial sector shapes long-term consumption patterns
General economic indicators, ‘animal spirits', and trust all explain ‘consumer sentiment crisis' stoked by the Great Recession, according to DNB working paper
Higher interest rates would have hurt savers, says ECB's Cœuré
Executive board member says loose monetary policy does not stem from a desire to favour borrowers, but as a necessary response to bring the world economy back to growth and ultimately help savers
Bank of Albania governor highlights impact of euro crisis on non-EU members
Eastern European countries that are home to branches and subsidiaries of eurozone banks fell victim to lenders' lower risk tolerance and insufficient regulatory coordination, says Ardian Fullani
Crisis prompted both ‘re-discovery' and overhaul of CBs' emergency liquidity
Walter Bagehot's dictum to lend freely at high interest rates and against good collateral during a financial panic was revived, then altered during the crisis, according to Thomas Baxter of the NY Fed
Rosengren paper tackles role of banks in monetary transmission
Boston Fed president presents evidence on the effectiveness of the bank lending channel and provides observations about likely consequences of changes associated with the financial crisis
Near-zero interest rates of limited help to non-financial firms
BIS quarterly review article finds that lesser pass-through is partly related to higher premium for risk required by financial intermediaries
BoJ paper: ‘Sudden stop' central factor in recent financial crises
Guillermo Calvo argues 'sudden stops' help explain a number of issues which conventional monetary policy fails adequately to address