Search Results
Working Paper
Deconstructing Delays in Sovereign Debt Restructuring
Benjamin, David; Wright, Mark L. J.
(2018-07-16)
Negotiations to restructure sovereign debt are time consuming, taking almost a decade on average to resolve. In this paper, we analyze a class of widely used complete information models of delays in sovereign debt restructuring and show that, despite superficial similarities, there are major differences across models in the driving force for equilibrium delay, the circumstances in which delay occurs, and the efficiency of the debt restructuring process. We focus on three key assumptions. First, if delay has a permanent effect on economic activity in the defaulting country, equilibrium delay ...
Working Papers
, Paper 753
Report
Federal Reserve Participation in Public Treasury Offerings
Garbade, Kenneth D.
(2019-12-01)
This paper describes the evolution of Federal Reserve participation in public Treasury offerings. It covers the pre-1935 period, when the Fed participated on an equal footing with other investors in exchange offerings priced by Treasury officials, to its present-day practice of reinvesting the proceeds of maturing securities with “add-ons” priced in public auctions in which the Fed does not participate. The paper describes how the Federal Reserve System adapted its operating procedures to comply with the 1935 limitations on its Treasury purchases, how it modified its operating procedures ...
Staff Reports
, Paper 906
Report
Managing the Maturity Structure of Marketable Treasury Debt: 1953-1983
Garbade, Kenneth D.
(2020-07-01)
This paper examines the evolution of the maturity structure of marketable Treasury debt from 1953 to 1983. Average maturity contracted erratically from 1953 to 1960, expanded through mid-1965, contracted again through late 1975, and then expanded into the early 1980s. What accounts for these broad trends? In particular, what were the maturity objectives of Treasury debt managers? Were they able to achieve their objectives? Why or why not?
Staff Reports
, Paper 936
Working Paper
Optimal Bailouts in Banking and Sovereign Crises
Hur, Sewon; Sosa-Padilla, César; Yom, Zeynep
(2021-01-29)
We study optimal bailout policies in the presence of banking and sovereign crises. First, we use European data to document that asset guarantees are the most prevalent way in which sovereigns intervene during banking crises. Then, we build a model of sovereign borrowing with limited commitment, where domestic banks hold government debt and also provide credit to the private sector. Shocks to bank capital can trigger banking crises, with government sometimes finding it optimal to extend guarantees over bank assets. This leads to a trade-off: Larger bailouts relax domestic financial frictions ...
Globalization Institute Working Papers
, Paper 406
Working Paper
Optimal time-consistent government debt maturity
Debortoli, Davide; Yared, Pierre; Nunes, Ricardo
(2016-05-17)
The current literature on a government's optimal debt maturity structure contends that by purchasing short-term assets and selling long-term debt, it is possible to fully insulate the economy against fiscal shocks. The required short and long positions are large relative to GDP and constant. The market value of debt adjusts automatically and the constant debt positions and fluctuating bond prices insulate against potential shocks. However, achieving the goal of averting future shocks depends on the government perfectly committing to the future fiscal policy, for without this sustained ...
Working Papers
, Paper 16-4
Working Paper
Fiscal Austerity in Ambiguous Times
Ferrière, Axelle; Karantounias, Anastasios G.
(2016-03-01)
This paper analyzes optimal fiscal policy with ambiguity aversion and endogenous government spending. We show that, without ambiguity, optimal surplus-to-output ratios are acyclical and that there is no rationale for either reduction or further accumulation of public debt. In contrast, ambiguity about the cycle can generate optimally policies that resemble "austerity" measures. Optimal policy prescribes higher taxes in adverse times and front-loaded fiscal consolidations that lead to a balanced primary budget in the long-run. This is the case when interest rates are sufficiently responsive ...
FRB Atlanta Working Paper
, Paper 2016-6
Report
Financial market implications of the federal debt paydown
Fleming, Michael J.
(2001-03-01)
U.S. Treasury securities fill several crucial roles in financial markets: they are a risk-free benchmark, a reference and hedging benchmark, and a reserve asset to the Federal Reserve and other financial institutions. Many of the features that make the Treasury market an attractive benchmark and reserve asset are likely to be adversely affected by the paydown of the federal debt, and recent developments suggest that this may be happening already. Market participants are responding by moving away from Treasuries as a reference and hedging benchmark toward agency debt securities, corporate debt ...
Staff Reports
, Paper 120
Working Paper
Optimal Bailouts in Banking and Sovereign Crises
Sosa-Padilla, César; Yom, Zeynep; Hur, Sewon
(2024-02-27)
We study optimal bailout policies amidst banking and sovereign crises. Our model features sovereign borrowing with limited commitment, where domestic banks hold government debt and extend credit to the private sector. Bank capital shocks can trigger banking crises, prompting the government to consider extending guarantees over bank assets. This poses a trade-off: Larger bailouts relax financial frictions and increase output, but increase fiscal needs and default risk (creating a ‘diabolic loop’). Optimal bailouts exhibit clear properties. The fraction of banking losses the bailouts cover ...
Globalization Institute Working Papers
, Paper 406
Working Paper
Is Inflation Default? The Role of Information in Debt Crises
Bassetto, Marco; Galli, Carlo
(2017-03-17)
We consider a two-period Bayesian trading game where in each period informed agents decide whether to buy an asset ("government debt") after observing an idiosyncratic signal about the prospects of default. While second-period buyers only need to forecast default, first-period buyers pass the asset to the new agents in the secondary market, and thus need to form beliefs about the price that will prevail at that stage. We provide conditions such that coarser information in the hands of second-period agents makes the price of debt more resilient to bad shocks not only in the last period, but ...
Working Paper Series
, Paper WP-2017-6
Working Paper
Exposure to international crises: trade vs. financial contagion
Grant, Everett
(2016-08-01)
I identify new patterns in countries' economic performance over the 2007-2014 period based on proximity through distance, trade, and finance to the US subprime mortgage and Eurozone debt crisis areas. To understand the causes of the cross-country variation, I develop an open economy model with two transmission channels that can be shocked separately: international trade and finance. The model is the first to include a government and heterogeneous firms that can default independently of one another and has a novel endogenous cost of sovereign default. I calibrate the model to the average ...
Globalization Institute Working Papers
, Paper 280
FILTER BY year
FILTER BY Bank
Board of Governors of the Federal Reserve System (U.S.) 15 items
Federal Reserve Bank of New York 13 items
Federal Reserve Bank of Atlanta 7 items
Federal Reserve Bank of Dallas 7 items
Federal Reserve Bank of Minneapolis 7 items
Federal Reserve Bank of Philadelphia 5 items
Federal Reserve Bank of St. Louis 5 items
Federal Reserve Bank of Chicago 3 items
Federal Reserve Bank of Kansas City 2 items
Federal Reserve Bank of Boston 1 items
Federal Reserve Bank of Cleveland 1 items
Federal Reserve Bank of Richmond 1 items
show more (7)
show less
FILTER BY Series
Staff Reports 11 items
Working Papers 11 items
Finance and Economics Discussion Series 7 items
Globalization Institute Working Papers 7 items
FRB Atlanta Working Paper 6 items
International Finance Discussion Papers 6 items
Staff Report 5 items
Economic Policy Review 2 items
Federal Reserve Bulletin 2 items
Review 2 items
Working Paper Series 2 items
Chicago Fed Letter 1 items
Economic Bulletin 1 items
Economic Review 1 items
Policy Hub 1 items
Working Paper 1 items
Working Papers (Old Series) 1 items
show more (12)
show less
FILTER BY Content Type
Working Paper 41 items
Report 16 items
Journal Article 8 items
Discussion Paper 1 items
Newsletter 1 items
FILTER BY Author
Garbade, Kenneth D. 7 items
Erce, Aitor 6 items
Karantounias, Anastasios G. 6 items
D'Erasmo, Pablo 4 items
Fleming, Michael J. 4 items
Mallucci, Enrico 4 items
Abbassi, Puriya 3 items
Crosignani, Matteo 3 items
Hur, Sewon 3 items
Iyer, Rajkamal 3 items
Keane, Frank M. 3 items
Kehoe, Timothy J. 3 items
Mendoza, Enrique G. 3 items
Peydró, José-Luis 3 items
Soto, Paul E. 3 items
Barone, Jordan 2 items
Bassetto, Marco 2 items
Bi, Huixin 2 items
Cashin, David B. 2 items
Chaboud, Alain P. 2 items
Copeland, Adam 2 items
Faria-e-Castro, Miguel 2 items
Ferris, Erin E. Syron 2 items
Fonseca, Luis 2 items
Grittayaphong, Praew 2 items
Kavoussi, Cullen 2 items
Klee, Elizabeth C. 2 items
Nicolini, Juan Pablo 2 items
Restrepo-Echavarria, Paulina 2 items
Searls, Seth 2 items
Sosa-Padilla, César 2 items
Wright, Mark L. J. 2 items
Yom, Zeynep 2 items
Arellano, Cristina 1 items
Athanasopoulou, Marialena 1 items
Ayres, Joao Luiz 1 items
Balteanu, Irina 1 items
Benjamin, David 1 items
Bertaut, Carol C. 1 items
Braun, R. Anton 1 items
Calomiris, Charles W. 1 items
Carpinelli, Luisa 1 items
Chatterjee, Satyajit 1 items
Cheng, Gong 1 items
Consiglio, Andrea 1 items
Croce, Mariano 1 items
De Ferra, Sergio 1 items
Debortoli, Davide 1 items
Dias, Daniel A. 1 items
Diaz-Cassou, Javier 1 items
Dupont, Dominique 1 items
Esquivel, Carlos 1 items
Eyigungor, Burcu 1 items
Ferrière, Axelle 1 items
Galli, Carlo 1 items
Garcia, Marcio 1 items
Gavilan, Angel 1 items
Gennaro Caracciolo, Gherardo 1 items
Glasserman, Paul 1 items
Grant, Everett 1 items
Griever, William L. 1 items
Guillen, Diogo 1 items
Gutkowski, Violeta A. 1 items
Joines, Douglas H. 1 items
Kehoe, Patrick J. 1 items
Kondo, Illenin O. 1 items
Lee, Seung Jung 1 items
Machicado, Carlos Gustavo 1 items
Mateos-Planas, Xavier 1 items
Moscoso Boedo, Herman J. 1 items
Moshammer, Edmund 1 items
Nunes, Ricardo 1 items
Palacios, Santiago I. Sordo 1 items
Patel, Ketan B. 1 items
Peres-Cajías, José 1 items
Perri, Fabrizio 1 items
Phan, Toan 1 items
Pia Olivero, Maria 1 items
Picarelli, Mattia 1 items
Posenau, Kelly E. 1 items
Pouzo, Demian 1 items
Presno, Ignacio 1 items
Raymond, Stephen 1 items
Richmond, Christine 1 items
Rios-Rull, Jose-Victor 1 items
Sack, Brian P. 1 items
Saggar, Seema 1 items
Sangiacomo, Maximo 1 items
Sareen, Samita 1 items
Sargent, Thomas J. 1 items
Schmid, Lukas 1 items
Schwartzman, Felipe 1 items
Shen, Wenyi 1 items
Sirohi, Amit 1 items
Stebunovs, Viktors 1 items
Stevens, Cailey 1 items
Tryon, Ralph W. 1 items
Yang, Shu-Chun S. 1 items
Yared, Pierre 1 items
Zenios, Stavros A. 1 items
Zhang, Allen 1 items
show more (96)
show less
FILTER BY Jel Classification
F34 20 items
E62 15 items
G28 10 items
E58 9 items
G01 9 items
G12 9 items
G21 9 items
H21 8 items
E44 7 items
F41 7 items
E63 6 items
E32 5 items
E52 5 items
N22 5 items
D80 4 items
G14 4 items
G15 4 items
H62 4 items
E43 3 items
E6 3 items
E65 3 items
H12 3 items
L51 3 items
N16 3 items
C61 2 items
D52 2 items
E31 2 items
E42 2 items
F44 2 items
G11 2 items
G18 2 items
G23 2 items
H30 2 items
H84 2 items
C60 1 items
C63 1 items
C73 1 items
C78 1 items
C82 1 items
D11 1 items
D14 1 items
D61 1 items
D8 1 items
D84 1 items
D90 1 items
E01 1 items
E21 1 items
E3 1 items
E47 1 items
E50 1 items
E51 1 items
F30 1 items
F33 1 items
F36 1 items
F40 1 items
F45 1 items
F53 1 items
G32 1 items
G38 1 items
H50 1 items
H51 1 items
H55 1 items
H75 1 items
H81 1 items
H87 1 items
J32 1 items
K00 1 items
K41 1 items
N26 1 items
O3 1 items
P16 1 items
Q54 1 items
show more (68)
show less
FILTER BY Keywords
sovereign defaults 7 items
Sovereign default 7 items
Fiscal policy 5 items
public debt 5 items
government debt 5 items
COVID-19 4 items
Debt crisis 4 items
Asset quality review 3 items
Corporate real effects from bank credit 3 items
Costs of safe assets 3 items
Lender of Last Resort 3 items
Monetary policy 3 items
Risk-masking 3 items
Stress tests 3 items
Supervision 3 items
ambiguity aversion 3 items
debt management 3 items
labor tax 3 items
multiplier preferences 3 items
sovereign debts 3 items
Bailouts 3 items
Liquidity 3 items
Sovereign Debt 3 items
Banking Crises 3 items
Banking crisis 2 items
Conditional Transfers 2 items
Debt 2 items
Domestic Debt 2 items
European crisis 2 items
Off-budget transfers 2 items
Sovereign-bank diabolic loop 2 items
Treasury debt management 2 items
U.S. Treasury 2 items
Unconventional Monetary Policy 2 items
austerity 2 items
competitive fringe 2 items
financial crisis 2 items
fiscal deficits 2 items
fiscal limits 2 items
martingale 2 items
misspecification 2 items
open market operations 2 items
sovereign bond markets 2 items
sovereign debt restructuring 2 items
Auctions 2 items
Debt Crises 2 items
Debt Limit 2 items
Emerging markets 2 items
Inflation 2 items
Model uncertainty 2 items
Optimal taxation 2 items
Treasury Market 2 items
Bank Credit Supply 1 items
Bank Wholesale Funding 1 items
Bank networks 1 items
Bank-Sovereign Nexus 1 items
Bargaining 1 items
Bid-ask spread 1 items
Bolivia 1 items
Brazil hyperinflation 1 items
Brazil stagnation 1 items
Collateral 1 items
Continuous Solutions 1 items
Credit 1 items
Credit-to-GDP gap 1 items
Crisis management 1 items
Currency Denomination 1 items
Currency crises 1 items
Database 1 items
Debt accounting 1 items
Debt restructuring 1 items
Default 1 items
Default episodes 1 items
Default risk 1 items
Delay 1 items
Devaluation 1 items
Discount 1 items
Domestic law 1 items
Early warning system 1 items
Epstein-Zin 1 items
European debt crisis 1 items
Eurozone 1 items
Eurozone Crisis 1 items
External Debt 1 items
Federal Reserve 1 items
Federal debt 1 items
Financial contagion 1 items
Financial crises 1 items
Financial vulnerabilities 1 items
Fiscal deficit 1 items
Fiscal stimulus 1 items
Fiscal sustainability 1 items
Fiscal theory of the price level 1 items
Globalization 1 items
Government expenditures 1 items
Government securities 1 items
Hyperinflation 1 items
Imports 1 items
Incomplete markets 1 items
India 1 items
Information sensitivity of debt 1 items
International Monetary Fund (IMF) 1 items
Investments, Foreign 1 items
Issue size 1 items
Japan 1 items
Lotteries 1 items
Macroprudential policy 1 items
Markov Perfect Equilibrium 1 items
Markov-perfect equilibrium 1 items
Monetary union 1 items
Monetary/fiscal interaction 1 items
Money premium 1 items
Official debt 1 items
Paris Club 1 items
Pigouvian taxes 1 items
Political uncertainty 1 items
Public enterprises 1 items
Quasi-geometric 1 items
Quasi-hyperbolic 1 items
R&D investment 1 items
Ramsey plans 1 items
Ramsey taxation 1 items
Securities 1 items
Selective Defaults 1 items
Sovereign contagion 1 items
Sovereign risk 1 items
Stabilization plans 1 items
Stocks 1 items
TARGET2 1 items
Time consistency 1 items
Trading volume 1 items
Treasury auctions 1 items
Treasury bills 1 items
Treasury debt issuance 1 items
Treasury securities 1 items
Treasury yields 1 items
World Bank 1 items
advance refundings 1 items
aging 1 items
balanced budget 1 items
bank crises 1 items
banks 1 items
beliefs 1 items
benchmark 1 items
capital tax 1 items
climate change 1 items
conditional Value-at-Risk 1 items
credit markets 1 items
debt ceiling 1 items
debt financing 1 items
debt maturity 1 items
demand uncertainty 1 items
developing countries 1 items
direct purchases 1 items
disasters 1 items
domestic nominal debt 1 items
endogenous growth 1 items
excess burden 1 items
financial economics 1 items
fiscal consolidation 1 items
fiscal dominance 1 items
fiscal insurance 1 items
generalized Euler equation 1 items
government 1 items
government bonds 1 items
government deficits 1 items
growth 1 items
inflation risks 1 items
innovation 1 items
interest rates 1 items
intertemporal elasticity of substitution 1 items
long-term bonds 1 items
long-term debt 1 items
maturity structure of debt 1 items
monetization of gold 1 items
monopolist 1 items
optimization 1 items
paternalism 1 items
pessimistic expectations 1 items
profit tax 1 items
public consumption 1 items
quadratic programming 1 items
recursive utility 1 items
rescue packages 1 items
reserve asset 1 items
risk measures 1 items
robustness 1 items
scenario analyses 1 items
stochastic programming 1 items
subsidy 1 items
sustainability 1 items
tax smoothing 1 items
taxation 1 items
time-consistency 1 items
trading activity 1 items
uncertainty 1 items
yield curve management 1 items
show more (212)
show less