George Soros knows financial markets -- it's how he got to be a billionaire. So when he starts pointing out fundamental flaws in today's markets and calls for reform, he's doing it from within the machine. Soros has a new book out, "The New Paradigm for Financial...
Return on Investment is one of several profitability ratios, one of the four basic classes of financial ratios—the others being liquidity ratios, activity ratios and debt ratios. This, the Return on Investment, often called a company’s return on total assets, measures the overall profit made on an investment expressed as...
The authors have used a "New-open-economy macroeconomics" model featuring a labor-market friction in the form of efficiency wages to analyze the implication of financial market integration for the fiscal multiplier. The fiscal multiplier measures the accumulated effects of fiscal policy on output. Conventional wisdom based on the classic Mundell-Fleming model...
This paper investigates whether self-regulation in financial markets leads to greater industry bias and expertise in enforcement. Using hand-collected data on securities arbitration disputes from the National Association of Securities Dealers NASD, the author document that pro-industry arbitrators are selected more often to arbitration panels than pro-investor ones (selection on...
Over the last half-century, around the world, many nations have seen plummeting fertility rates and mounting life expectancies. These two factors are the engine behind unprecedented global aging. This paper explores how the demographic transition may influence financial markets and, in turn, how financial market innovation might help resolve concerns...
NEW YORK -- Citigroup has just released the 2007 edition of its flagship annual Economic and Market Analysis research report, Prospects for Financial Markets, entitled "Opportunity and Risk in a Low-Volatility World." In addition to presenting detailed discussions of our market and economic views, the report discusses trends in macro...
The paper investigates how buyer-supplier firm-specific relationships affect security prices. Starting from the empirical inconsistencies associated with some standard structural models we proposes a structural model of firm dependence in a variety connected network of firms based on cash flow transfers between the buyers and the suppliers. We prove that...
The empirical literature finds mixed evidence on the existence of positive productivity externalities in the host country generated by foreign multinational companies. We propose a novel mechanism, which emphasizes the role of local financial markets in enabling Foreign Direct Investment FDI to promote growth through backward linkages, shedding light on...
The objective of this article is to outline what one, as a researcher, knows and, more importantly, what one does not yet know about the consequences of terrorism for financial markets. The paper argues that a number of the efforts used to assess quantitatively the risk of terrorist attacks are...
This paper incorporates firm heterogeneity endogenously generated by the imperfections in the financial markets in a 2 × 2 × 2 H-O framework and analyzes the effects of trade on the efficiency of entrepreneurial selection, industry productivity, and financial development. Agents differ in managerial talents, which affects the productivity of...
This paper introduces fiscal policy in a model of sovereign risk spreads ("Spreads"). Using panel data from emerging market countries, it is found that reductions in public expenditure are a more powerful tool for reducing spreads than increases in revenues. Specifically, cuts in current spending lower spreads by more than...
This paper is the first part of an analysis that aims to evaluate the likely importance of demographic trends on market returns in the United States. The paper focuses on the impact of future demographic trends on market returns that would arise from changing flows into and out of retirement...
Defined contribution retirement plans expose retirement savers to financial market risks. The amount of risk and the link between financial market fluctuations and retirement income security depends on several choices that plan participants make. This paper describes the behavior of retirement savers who participate in the most common type of...
The paper highlights that the changes under way in public and private pension schemes may increase significantly the influence of retirement saving and related capital flows in financial markets. Regulatory and supervisory developments should aim to influence and support the trend towards more rigorous risk management, greater transparency, and better...
Competition, regulatory changes and market volatility necessitate extremely sophisticated decision making tools for financial institutions to thrive in this complex marketplace. Further, the data volumes that are generated in real-time (e.g., market data) or need to be analyzed (reference data, historical data) have also increased significantly. Today's market needs the...
Recent financial market and plan termination experiences have exposed the shortcomings of existing funding, disclosure, and premium rules governing private single-employer defined benefit pension plans in the United States. These rules were designed to provide predictability for plan sponsors and administrators, by insulating pension plans from the realities of economic...
The issue of corporate governance continues to attract considerable national and international attention. The Basel Committee on Banking Supervision the Committee published guidance in 1999 to assist banking supervisors in promoting the adoption of sound corporate governance practices by banking organizations in their countries. This paper drew from principles of...
This paper presents techniques for modeling and estimating the behavior of financial market price or return differentials that follow non-linear regime-switching behavior. The methodology to be used here is estimation of variants of threshold auto regression TAR models. In the basic model the differentials are random within a band defined...
This paper provides a detailed description of the shape and financial importance networks amongst the universe of firms in an emerging economy where a network link is defined as board interlocks i.e. two firms share a common director. This is done by making use of a novel dataset from Pakistan...
This document presents a report which reviews the measures taken by selected critical financial market organizations, including exchanges, clearing organizations, and payment system processors, to protect themselves from attacks. The aim was to assess the information security programs in place at these organizations. To maintain the confidentiality of the sensitive...
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