The Distress Anomaly is Deeper than you Think: Evidence from Stocks and Bonds

2021 ◽  
Author(s):  
Doron Avramov ◽  
Tarun Chordia ◽  
Gergana Jostova ◽  
Alexander Philipov

Abstract The distress anomaly reflects the abnormally low returns of high credit risk stocks during financial distress. Evidence from stocks and corporate bonds reinforces the anomaly and challenges rationales based on shareholders’ ability to extract value from bondholders, time-varying betas, lottery-type preferences, biased earnings expectations, and limits-to-arbitrage. Moreover, mispricing of distressed stocks and bonds is associated with excess investment and excess external financing. Potential real distortions are materially understated when assessed based only on equity mispricing. We emphasize the important role of corporate bonds in dissecting the distress anomaly, and show that the anomaly is an unresolved puzzle.

2020 ◽  
Vol 12 (2) ◽  
pp. 235-253
Author(s):  
Sotirios Karagiannis ◽  
Dimitrios Thomakos

This study investigates the impact of corporate bonds issued by Greek listed firms on employment. Even though external financing and the effects on employment has been studied in the literature, we extend the existing literature by focusing for the first time on the specific role of corporate bonds on employment. We have collected all the relevant papers on this line of the literature and concisely report them in a table format and then use them in analyzing our results. Our empirical analysis is based on a panel dataset from 2001 to 2014 and we examine the effect of corporate bonds in the pre and post period of the Greek economic crisis, in which the banking system is vulnerable and unable to provide financing to the firms. The results suggest that corporate bonds have a positive effect on employment in the pre-crisis sample, denoting that firms hire employees and proceed to investment choices. On the contrary, during the recession, corporate bonds have a negative effect on employment. Firms reduce their costs and try to control their debt obligations by issuing corporate bonds.


2004 ◽  
Vol 6 (2) ◽  
pp. 31-48 ◽  
Author(s):  
Nagisa Akutsu ◽  
Masaaki Kijima ◽  
Katsuya Komoribayashi

2021 ◽  
Vol 13 (9) ◽  
pp. 4898
Author(s):  
Andrzej Tucki ◽  
Korneliusz Pylak

Regional inequalities are a major concern for governments and policymakers. There is no doubt that tourism impacts the reduction of inequalities, but this impact is not entirely clear. We consider this ambiguity to be related to both the level of study and type of accommodation. In the present study, we examine the inequality level measured by the Gini coefficient in 108 municipalities of the peripheral region of northeastern Poland from 2009 to 2018. We employ a directional spillover index to measure the impact of two accommodation types on tax incomes per capita. The empirical results indicate that collective accommodation-based tourism only reduced inequality during the financial crisis, while individual accommodation-based tourism started to reduce inequality from 2014, when Russian sanctions hit local agriculture and businesses. These results indicate that the role of accommodation types is time-varying and evident in measuring economic distress during and after shocks.


2021 ◽  
Vol 0 (0) ◽  
Author(s):  
Martin L. Pall

Abstract Millimeter wave (MM-wave) electromagnetic fields (EMFs) are predicted to not produce penetrating effects in the body. The electric but not magnetic part of MM-EMFs are almost completely absorbed within the outer 1 mm of the body. Rodents are reported to have penetrating MM-wave impacts on the brain, the myocardium, liver, kidney and bone marrow. MM-waves produce electromagnetic sensitivity-like changes in rodent, frog and skate tissues. In humans, MM-waves have penetrating effects including impacts on the brain, producing EEG changes and other neurological/neuropsychiatric changes, increases in apparent electromagnetic hypersensitivity and produce changes on ulcers and cardiac activity. This review focuses on several issues required to understand penetrating effects of MM-waves and microwaves: 1. Electronically generated EMFs are coherent, producing much higher electrical and magnetic forces then do natural incoherent EMFs. 2. The fixed relationship between electrical and magnetic fields found in EMFs in a vacuum or highly permeable medium such as air, predicted by Maxwell’s equations, breaks down in other materials. Specifically, MM-wave electrical fields are almost completely absorbed in the outer 1 mm of the body due to the high dielectric constant of biological aqueous phases. However, the magnetic fields are very highly penetrating. 3. Time-varying magnetic fields have central roles in producing highly penetrating effects. The primary mechanism of EMF action is voltage-gated calcium channel (VGCC) activation with the EMFs acting via their forces on the voltage sensor, rather than by depolarization of the plasma membrane. Two distinct mechanisms, an indirect and a direct mechanism, are consistent with and predicted by the physics, to explain penetrating MM-wave VGCC activation via the voltage sensor. Time-varying coherent magnetic fields, as predicted by the Maxwell–Faraday version of Faraday’s law of induction, can put forces on ions dissolved in aqueous phases deep within the body, regenerating coherent electric fields which activate the VGCC voltage sensor. In addition, time-varying magnetic fields can directly put forces on the 20 charges in the VGCC voltage sensor. There are three very important findings here which are rarely recognized in the EMF scientific literature: coherence of electronically generated EMFs; the key role of time-varying magnetic fields in generating highly penetrating effects; the key role of both modulating and pure EMF pulses in greatly increasing very short term high level time-variation of magnetic and electric fields. It is probable that genuine safety guidelines must keep nanosecond timescale-variation of coherent electric and magnetic fields below some maximum level in order to produce genuine safety. These findings have important implications with regard to 5G radiation.


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