scholarly journals Capital Markets Union: A Vision for the Long Term

2016 ◽  
Vol 2 (1) ◽  
pp. 130-153 ◽  
Author(s):  
Nicolas Véron ◽  
Guntram B. Wolff
Keyword(s):  
Financial Markets ◽  
Capital Markets ◽  
Financial Stability ◽  
Financial Integration ◽  
Bank Lending ◽  
The European Union ◽  
Short Term ◽  
Capital Markets Union ◽  
Improve Access

Abstract Capital Markets Union (CMU) is a welcome economic policy initiative. If well designed and implemented, it can improve access to funding, the allocation of capital, prospects for savers, and financial stability in the European Union. But since financial ecosystems only change slowly, CMU cannot be a short-term cyclical instrument to substitute for subdued bank lending. Shifting financial intermediation towards capital markets will require persistent action on multiple fronts. The policy agenda should aim to enhance both capital markets development and cross-border financial integration, two distinct but mutually reinforcing aims; to increase the transparency, reliability, and comparability of information, a key enabler of trust in financial markets which always involve information asymmetries; and to adequately address financial stability concerns. We propose a staged process to sustain the momentum and make Europe’s CMU fully worthy of its 'union' label.

scholarly journals Pandemics, Climate and Public Finance

2020 ◽  
Author(s):  
Stefano Battiston ◽  
Monica Billio ◽  
Irene Monasterolo
Keyword(s):  
Financial Stability ◽  
The European Union ◽  
Short Term ◽  
Economic Resilience ◽  
Taxation Policy ◽  
Containment Measures ◽  
Socio Economic Impact ◽  
Business As Usual ◽  
The Eu

The outbreak of COVID-19 and the containment measures are having an unprecedented socio-economic impact in the European Union (EU) and elsewhere. The policies introduced so far in the EU countries promote a ‘business as usual’ economic recovery. This short-term strategy may jeopardise the mid-to-long-term sustainability and financial stability objectives. In contrast, strengthening the socio-economic resilience against future pandemics, as well as other shocks, calls for recovery measures that are fully aligned to the objectives of the EU Green Deal and of the EU corporate taxation policy. Tackling these long-term objectives is not more costly than funding the current short-term measures. Remarkably, it may be the only way to build resilience to future crises.

Securitization in the Capital Markets Union

2018 ◽  
Author(s):  
Gerard Kastelein
Keyword(s):  
Capital Markets ◽  
Negotiation Process ◽  
Short Term ◽  
Market Participants ◽  
Capital Markets Union ◽  
Negative Effect ◽  
Commercial Paper ◽  
Application Date ◽  
Primary Focus

On 30 May 2017, the European Parliament, Council, and Commission reached a political agreement on the package of regulatory reforms of the European securitisation market. The package is aimed at facilitating the development of a securitisation market in Europe. The package represents the latest development of a negotiation process that started back in September 2015. The application date is expected to be 1 January 2019. Meanwhile, market participants have expressed uncertainties as to its effectiveness. This chapter considers the risk that the package will have a negative effect on the European securitisation market, resulting in further contraction. The primary focus of the chapter is on the rules on long-term securitisations as opposed to the short-term securitisations (asset-backed commercial paper).

scholarly journals Governing through financial markets: Towards a critical political economy of Capital Markets Union

2018 ◽  
Vol 22 (2) ◽  
pp. 101-116 ◽  
Author(s):  
Benjamin Braun ◽  
Daniela Gabor ◽  
Marina Hübner
Keyword(s):  
Financial Markets ◽  
Capital Markets ◽  
Large Scale ◽  
The United States ◽  
Shadow Banking ◽  
Political Strategy ◽  
The European Union ◽  
Policy Goals ◽  
Capital Markets Union ◽  
Policy Priority

Capital Markets Union is a large-scale political project to strengthen and further integrate European market-based finance. An initiative of the European Commission under Jean-Claude Juncker’s leadership, Capital Markets Union seeks to realize a long-standing goal of European policy makers: a financial system in which capital markets will absorb more of citizens’ savings and play a greater role in corporate finance. Market-based banking, too, is set to benefit from Capital Markets Union, which includes measures to revive the European securitization market. Given that market-based finance – or shadow banking – shouldered much of the blame for the financial crisis of 2007–2008, its resurgence as a policy priority of the European Union constitutes a puzzle. The present article lays the theoretical groundwork for a special issue that tackles this puzzle. It argues that rather than an end in itself, Capital Markets Union represents an exercise in ‘governing through financial markets’. Pioneered in the United States, governing through financial markets is a political strategy adopted by state actors in pursuit of policy goals that exceed their institutional capacity.

Impact of FII’s and FDI’s on Indian Stock Market

2016 ◽  
Vol 1 (1) ◽  
Author(s):  
Dr. Kamlesh Kumar Shukla
Keyword(s):  
Stock Market ◽  
Financial Markets ◽  
Global Economy ◽  
Short Term ◽  
Earnings Growth ◽  
The Past ◽  
Bull Market ◽  
Indian Stock Market

FIIs are companies registered outside India. In the past four years there has been more than $41 trillion worth of FII funds invested in India. This has been one of the major reasons on the bull market witnessing unprecedented growth with the BSE Sensex rising 221% in absolute terms in this span. The present downfall of the market too is influenced as these FIIs are taking out some of their invested money. Though there is a lot of value in this market and fundamentally there is a lot of upside in it. For long-term value investors, there’s little because for worry but short term traders are adversely getting affected by the role of FIIs are playing at the present. Investors should not panic and should remain invested in sectors where underlying earnings growth has little to do with financial markets or global economy.

Private Placements in the Capital Markets Union

2018 ◽  
Author(s):  
Frank GB Graaf
Keyword(s):  
Capital Markets ◽  
Alternative Source ◽  
Private Placement ◽  
Private Placements ◽  
Capital Markets Union

This chapter looks at recent initiatives in the context of the European Commission's flagship plans for a Capital Markets Union (CMU) designed to encourage a pan-European private placement market. In reality, private placements are mainly available as a funding tool for medium-sized and larger companies. Nonetheless, private placements are regarded by CMU's policymakers as an alternative source of long-term funding, which is simple enough for smaller corporates and small and medium-sized enterprises (SME), and with benefits that they might find attractive. The Commission's initial intention in the design of a CMU was to enable a greater use by SMEs of private placements.

The Role of Financial Innovation in EU Market Integration and the Capital Markets Union

2018 ◽  
Author(s):  
Emilios Avgouleas
Keyword(s):  
Capital Markets ◽  
Risk Sharing ◽  
Market Integration ◽  
Financial Innovation ◽  
The European Union ◽  
Recent Developments ◽  
Capital Markets Union ◽  
Critical Overview ◽  
The Eu

This chapter offers a critical overview of the issues that the European Union 27 (EU-27) will face in the context of making proper use of financial innovation to further market integration and risk sharing in the internal financial market, both key objectives of the drive to build a Capital Markets Union. Among these is the paradigm shift signalled by a technological revolution in the realm of finance and payments, which combines advanced data analytics and cloud computing (so-called FinTech). The chapter begins with a critical analysis of financial innovation and FinTech. It then traces the EU market integration efforts and explains the restrictive path of recent developments. It considers FinTech's potential to aid EU market integration and debates the merits of regulation dealing with financial innovation in the context of building a capital markets union in EU-27.

Unfolding the case of returnees: How the European Union and its member States are addressing the return of foreign fighters and their families

2021 ◽  
pp. 1-23
Author(s):  
Carlota Rigotti ◽  
Júlia Zomignani Barboza
Keyword(s):  
European Union ◽  
Perceived Threat ◽  
The European Union ◽  
Security Threat ◽  
Short Term ◽  
Member States ◽  
Foreign Fighters ◽  
Term Response

Abstract The return of foreign fighters and their families to the European Union has mostly been considered a security threat by member States, which consequently adopt repressive measures aimed at providing an immediate, short-term response to this perceived threat. In addition to this strong-arm approach, reintegration strategies have also been used to prevent returnees from falling back into terrorism and to break down barriers of hostility between citizens in the long term. Amidst these different strategies, this paper seeks to identify which methods are most desirable for handling returnees.

A Note Concerning the Dynamics of Government Bond Yields

2021 ◽  
pp. 056943452098827
Author(s):  
Tanweer Akram
Keyword(s):  
Interest Rate ◽  
Financial Markets ◽  
Yield Curve ◽  
Empirical Studies ◽  
State Theory ◽  
Government Bond ◽  
Bond Yields ◽  
Short Term ◽  
Government Bonds

Keynes argued that the central bank can influence the long-term interest rate on government bonds and the shape of the yield curve mainly through the short-term interest rate. Several recent empirical studies that examine the dynamics of government bond yields not only substantiate Keynes’s view that the long-term interest rate responds markedly to the short-term interest rate but also have relevance for macroeconomic theory and policy. This article relates Keynes’s discussions of money, the state theory of money, financial markets, investors’ expectations, uncertainty, and liquidity preference to the dynamics of government bond yields for countries with monetary sovereignty. Investors’ psychology, herding behavior in financial markets, and uncertainty about the future reinforce the effects of the short-term interest rate and the central bank’s monetary policy actions on the long-term interest rate. JEL classifications: E12; E40; E43; E50; E58; E60; F30; G10; G12; H62; H63

scholarly journals The future of financial markets and regulation: what strategy for Europe?

foresight ◽  
2014 ◽  
Vol 16 (2) ◽  
pp. 95-108 ◽  
Author(s):  
Jean-Baptiste Gossé ◽  
Dominique Plihon
Keyword(s):  
Financial Markets ◽  
Capital Market ◽  
Financial Stability ◽  
Design Methodology ◽  
Financial Integration ◽  
Content Type ◽  
Realistic Option ◽  
The Future ◽  
Unstable Environment ◽  
Insight Into

Purpose – This article aims to provide insight into the future of financial markets and regulation in order to define what would be the best strategy for Europe. Design/methodology/approach – First the authors define the potential changes in financial markets and then the tools available for the regulator to tame them. Finally, they build five scenarios according to the main evolutions observed on the financial markets and on the tools used by the regulator to modify these trends. Findings – Among the five scenarios defined, two present highly unstable features since the regulator refuses to choose between financial opening and independently determining how to regulate finance in order to preserve financial stability. Three of them achieve financial stability. However, they are more or less efficient or feasible. In terms of market efficiency, the multi-polar scenario is the best and the fragmentation scenario is the worst, since gains of integration depend on the size of the new capital market. Regarding sovereignty of regulation, fragmentation is the best scenario and the multi-polar scenario is the worst, because it necessitates coordination at the global level which implies moving further away from respective national preferences. However, the more realistic option seems to be the regionalisation scenario: this level of coordination seems much more realistic than the global one; the market should be of sufficient size to enjoy substantial benefits of integration. Nevertheless, the “European government” might gradually increase the degree of financial integration outside Europe in line with the degree of cooperation with the rest of the world. Originality/value – Foresight studies on financial markets and regulation are quite rare. This may be explained by the difficulty to forecast what will be their evolution in the coming decades, not least because finance is fundamentally unstable. This paper provides a framework to consider what could be the best strategy of regulators in such an unstable environment.

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