A discussion paper on valuations for mortgage and the level of house prices

2015 ◽  
Vol 8 (1) ◽  
pp. 27-35 ◽  
Author(s):  
Philip Bowcock
Keyword(s):  
Design Methodology ◽  
House Prices ◽  
Current Approach ◽  
Mortgage Loan ◽  
Professional Experience ◽  
Major Contributor ◽  
Discussion Paper ◽  
Content Type ◽  
Fundamental Research ◽  
The International Monetary Fund

Purpose – The aim of the present paper is to consider the effect of the current approach to valuations for mortgage on the level of house prices during the housing bubble of 2000-2008 which has been a major contributor to the following recession followed previous smaller bubbles in 1972 and 1990. Despite a warning from the International Monetary Fund in 2004 that prices were too high and home buyers should “exercise particular caution”, no fundamental research appears to have been done into the contribution to this of those responsible for valuation for mortgage. Design/methodology/approach – Data from the Nationwide Quarterly Index were used as a basis and compared with the writer’s professional experience in carrying out valuations for mortgage. Findings – Instructions to valuers advising on the properties offered as security for a mortgage loan have requested only a valuation based on the market as it existed at the time of the valuation without regard to the possibility that a change in economic circumstances could cause a fall in the value of the security. Many mortgagors have found on sale or repossession that their liability to repay their mortgage is greater than the value of the property. Originality/value – Valuations for mortgage should include an indication of the possible risks involved, including the results of changes in the global economic environment.

Currency returns during democratic transition: evidence from Tunisia

2019 ◽  
Vol 45 (7) ◽  
pp. 966-979
Author(s):  
Ghadi Saad ◽  
Taoufik Bouraoui
Keyword(s):  
Design Methodology ◽  
Democratic Transition ◽  
Abnormal Returns ◽  
Market Model ◽  
Study Analysis ◽  
Content Type ◽  
Policy Effects ◽  
Cumulative Abnormal Returns ◽  
New Evidence ◽  
The International Monetary Fund

Purpose The purpose of this paper is to investigate the question whether democratic transition elections influence currency returns. Also, the paper examines the behavior of the currency market around these elections in Tunisia. Design/methodology/approach Empirical data are collected from the International Monetary Fund, the Central Bank of Tunisia and the Tunisian stock market websites. The paper employs event study analysis using a market model and investigates abnormal currency returns around the four election events that occurred during the period of democratic transition in Tunisia (2011–2015). A robustness test is also conducted to control for monetary policy effects. Findings The results indicate that democratic transition does impact currency returns. The authors did not find any significant effect on the events dates (t0). However, event windows around the elections days reacted significantly to the events. The authors notice a significant decrease in cumulative abnormal returns (CARs) at event periods leading up to the elections. Post-event windows perceived negative CARs in the first and second election, and positive CARs in the last two elections. The authors also find that the change in the victors of the elections does not cause major differences to CARs. Further, the authors do not find significant results when controlling for inflation and interest rate. Originality/value There is no evidence yet on how democratic transition elections can affect currency returns. Given that currency is a leading indicator of the performance of the financial sector, this paper should provide policymakers with new evidence on the response of currency returns to democratic transition.

First-time managers: increasing chances of their success before the promotion

2017 ◽  
Vol 49 (3) ◽  
pp. 132-138 ◽  
Author(s):  
Maria S. Plakhotnik
Keyword(s):  
Knowledge Base ◽  
Design Methodology ◽  
Training And Development ◽  
Professional Experience ◽  
Content Type ◽  
Professional Journals ◽  
Preparation Period ◽  
Managerial Positions ◽  
First Time ◽  
Development Consultant

Purpose The purpose of this paper is to discuss what could be done before the promotion to management to help first-time managers succeed in their new roles. Design/methodology/approach The paper reviews literature from scholarly and professional journals and magazines and uses the author’s professional experience as a training and development consultant. Findings The paper argues that organizations should offer support to first-time managers before they get promoted. This period could be called a preparation period. The paper suggests to differentiate between the preparation and transition periods because each has different goals. On the basis of the goals of the preparation period, the paper suggest activities that could be used by organizations. Originality/value Conversations about support of first-time managers to ease their transition to management usually evolve around either the ways newly promoted managers could help themselves by developing certain skills, knowledge base, and attitudes or the ways in which organizations could implement certain training and development activities after employees are promoted to managerial positions. Very little has been said about “the before” or the preparation period.

Assessing the 2010–2018 financial crisis in Greece, Portugal, Ireland, Spain, and Cyprus

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Kjell Hausken ◽  
Jonathan W. Welburn
Keyword(s):  
Financial Crisis ◽  
Design Methodology ◽  
Debt Ratio ◽  
Relative Risk Aversion ◽  
The European Union ◽  
Time Discounting ◽  
Content Type ◽  
Output Elasticity ◽  
Entire Duration ◽  
The International Monetary Fund

PurposeThe article develops a model to interpret the 2010–2018 financial crisis in Greece, Portugal, Ireland, Spain and Cyprus, and the loan programs from the IL (International Lender; i.e. the European Union, the European Commission, and the International Monetary Fund).Design/methodology/approachFor each country, an isoelastic utility with constant relative risk aversion is assumed. For the IL a Cobb Douglas utility is assumed with consumption, the GDP (Gross Domestic Product) to debt ratio, and market stability as inputs, accounting for time discounting. This article applies two methods to assess the empirics. The first method considers the IL's strategy as a whole over the 2010–2018 period. The second method assumes that the IL maximizes its utility in one period to determine its optimal loan, accounting for the empirics in that period, and the debt in the previous period.FindingsFor the first method, when the output elasticity in the IL's Cobb Douglas utility is high favoring consumption, the IL prefers offering a higher loan than its actual loan. Otherwise the IL prefers to offer no loan. The output elasticity at which the IL prefers to offer a loan is lowest for Greece, second lowest for Cyprus, third lowest for Portugal, and highest for Ireland and Spain. A high loan to Greece over a larger range of the output elasticity for Greece's consumption is supported by Greece being prioritized through the loan program. For the second method, the IL prefers to offer no loan to Greece which is too burdened with debt. Thus, the first method seems preferable, considering the entire duration of the crisis holistically.Originality/valueThe article offers a novel perspective of how to assess debt crises, enabling the IL to weigh various factors such as consumption, GDP, loan offered, and each country's debt to credit markets.

FCA discussion paper on open-ended funds and illiquidity

2017 ◽  
Vol 18 (4) ◽  
pp. 67-71 ◽  
Author(s):  
Panos Katsambas ◽  
Chu Ting Ng
Keyword(s):  
Design Methodology ◽  
Discussion Paper ◽  
Management Tools ◽  
Investment Funds ◽  
Liquidity Management ◽  
Secondary Markets ◽  
Content Type ◽  
Retail Investors ◽  
The Uk ◽  
Illiquid Assets

Purpose To explore the issues and questions put forward for consideration by stakeholders by the UK Financial Conduct Authority (FCA) in its discussion paper dated February 2017 – the purpose of which was to gather stakeholders’ views on illiquid assets and open-ended investment funds and seek to provide a basis for debate by setting out several policies for FCA intervention. Design/methodology/approach Explains and discusses the potential consequences of each issue and question put forward by the FCA, including definitions of illiquid assets, liquidity management tools, treatment of professional and retail investors, portfolio restrictions and liquidity buffers, valuation of illiquid assets, direct intervention by the FCA, enhanced disclosure, and secondary markets for illiquid assets. Findings What was found in the course of the work? The decision to suspend redemptions by these large property funds has brought to the forefront the key question of whether real estate or other illiquid assets are appropriate for open-ended funds. Many questions and considerations remain as to what impact the FCA’s proposed changes could have on the industry. The FCA consultation closed on 8 May 2017 and the results could determine new and adapted rules. Originality/value Practical guidance from experienced funds lawyers.

scholarly journals Two snapshots reinforcing systemic thinking and responsibility

2014 ◽  
Vol 5 (1) ◽  
pp. 45-54 ◽  
Author(s):  
Nick Barter ◽  
Sally Russell
Keyword(s):  
Sustainable Development ◽  
United Nations ◽  
Design Methodology ◽  
Final Analysis ◽  
Discussion Paper ◽  
Systemic Thinking ◽  
Content Type ◽  
Systemic Understanding ◽  
Common Future ◽  
Practical Implications

Purpose – This paper aims to explore the concept of sustainable development through the lens of two United Nations (UN) publications, Our Common Future (1987) and the 25-year update Resilient People: Resilient Planet (2012). The analysis attempts to highlight how sustainable development requires a systemic understanding and this in turn necessitates an imperative of responsibility. To reinforce its case, the paper highlights how sustainable development has never been about saving the environment and to think so is naïve. In the final analysis, the paper outlines how a systemic understanding is a key concern for organisational leaders and in turn a responsible understanding of humanity's entwinement with, rather than separation from, all that surrounds us. Design/methodology/approach – This paper is a discussion paper that weaves together existing literature. Findings – The aim of the paper is to reinforce systemic thinking and an imperative of responsibility. Practical implications – The arguments offered highlight how systemic thinking and the associated responsibility that comes with this view are necessary for realising sustainable outcomes. Originality/value – Weaving together and reinforcing arguments that highlight systemic thinking and responsibility.

Secure children’s homes – how do we know if they work?

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Richard Martin Pates ◽  
Rebecca Hannah Harris ◽  
Millicent Lewis ◽  
Sumayah Al-Kouraishi ◽  
David Tiddy
Keyword(s):  
Young People ◽  
Outcome Research ◽  
Design Methodology ◽  
Academic Journals ◽  
Discussion Paper ◽  
Content Type ◽  
Children’S Homes

Purpose This paper aims to examine the need for outcome research in secure children’s homes, explaining the problems for young people and how we can remedy this. Design/methodology/approach This is a discussion paper raising issues of importance as to who these children are, what is provided and how well they work in providing what is a very expensive service. Findings There is a great need to investigate the efficacy of secure children’s homes by assessing outcomes. Originality/value As far as the authors are aware, this topic has not been previously discussed in academic journals.

Comparison of advanced economies’ performance in bubbles mitigation

2019 ◽  
Vol 27 (4) ◽  
pp. 397-421
Author(s):  
Emilio Gallego Neira ◽  
Carlos Martínez de Ibarreta
Keyword(s):  
Design Methodology ◽  
House Prices ◽  
Seemingly Unrelated Regression ◽  
Household Debt ◽  
Fiscal Policies ◽  
Content Type ◽  
Residential Sector ◽  
Unrelated Regression ◽  
Advanced Economies ◽  
Dependent Variables

Purpose This paper aims to analyze the effectiveness of macroprudential and fiscal policies taken from a sample of ten advanced economies in relation to the mitigation of real-estate and credit bubbles by comparing their performance. Design/methodology/approach This comparison is elaborated with a seemingly unrelated regression methodology, which allows the assessment of individual countries’ performance and improves the estimation of the dependent variables versus an individual regression. Findings The analysis concludes that countercyclical measures have been more effective to control the growth of household debt. Furthermore, this study validates that macroprudential measures focused on the residential sector meet their objective of controlling the growth of house prices, whereas those macroprudential measures with more generic targets are effective to control the growth of household debt. Originality/value As opposed to previous panel-regression studies, which have analyzed the performance of macroprudential and fiscal measures in generic terms, this paper compares the performance of these tools in ten advanced economies. Based on the analysis performed, several recommendations are derived for policymakers.

Lord Carter's report into NHS ambulance service efficiency; will its findings make a difference and stimulate the service to escape “the mediocrity trap?”

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Andy Newton
Keyword(s):  
Critical Review ◽  
Design Methodology ◽  
Current Approach ◽  
Ambulance Service ◽  
Social Implications ◽  
Content Type ◽  
Policy Paper ◽  
Service Efficiency ◽  
Efficiency And Productivity ◽  
Practical Implications

PurposeReview of major policy paper in relation to the ambulance service [in England] efficiency and productivity with reference to observed “unacceptable variation”.Design/methodology/approachCritical review of ambulance service/EMS policy approach in England.FindingsLord Carter’s review describes failings in performance of UK ambulance service/EMS. However, the identified failings are essentially a repetition of many almost identical similar findings. There is a tendency of policy in respect of the ambulance service in England, as exemplified by Lord Carter’s report to consider analysis of the problem a more significant task that actually addressing the shortcoming defined.Research limitations/implicationsThis viewpoint comment piece is produced as a viewpoint with all the attendant limitations implied in this approach. However, it has been produced from an informed position.Practical implicationsChallenge to current UK ambulance policy. Previous repetitious finding need to be addressed definitively.Social implicationsThe efficiency of UK ambulance services/EMS is seriously impaired, and indeed these findings have been acknowledge previously. However, little by way of active remediation has been attempted. The current approach as exemplified in Lord Carter's recent review appears to ensure that analysis of the long- standing problems that exist is sufficient and possible preferable to active remediation and improvement.Originality/valueNo previous critical review of this type has been attempted (as it would be career-limiting).

scholarly journals Negative equity in Ireland: estimates using loan-level data

2014 ◽  
Vol 7 (3) ◽  
pp. 327-344 ◽  
Author(s):  
David Duffy ◽  
Niall O’Hanlon
Keyword(s):  
Design Methodology ◽  
Time Series Data ◽  
House Prices ◽  
Age Groups ◽  
Series Data ◽  
Data Set ◽  
Content Type ◽  
Equity Analysis ◽  
Level Data ◽  
Younger Age

Purpose – This paper aims to, using a unique loan-level data set, show the extent to which negative equity in Ireland is concentrated in younger age groups. The sharp decline in house prices since 2007 has led to the emergence of widespread negative equity in Ireland. However, little is known about the type of borrower experiencing negative equity. Design/methodology/approach – This paper uses a unique data set that, for a large sample of mortgages, provides details on both the characteristics of the borrowers and their mortgages. Using this data set, the paper estimates the incidence of negative equity by analysing loans taken out to purchase a primary residence in the period 2005-2012. Findings – The analysis finds the situation in Ireland to be much more severe than that being experienced in other housing market downturns at present, with 64 per cent of borrowers in the period 2005-2012 experiencing negative equity. Analysis by age gives rise to concern, with the majority of those in negative equity aged under 40 years. The paper also points to the large wealth loss experienced by Irish households, in the order of 43 billion, as a result of the fall in property values. Originality/value – The paper is one of the first using loan-level time-series data in Ireland. It highlights the growth in negative equity during the crisis and the extent to which it is concentrated in the younger age groups. It also provides an estimate of the loss in wealth suffered by all households due to the fall in Irish house prices.

scholarly journals Uncertainty shocks and policymakers’ behavior: evidence from the subprime crisis era

2015 ◽  
Vol 42 (4) ◽  
pp. 578-607 ◽  
Author(s):  
Michael Donadelli
Keyword(s):  
Empirical Evidence ◽  
Design Methodology ◽  
House Prices ◽  
Theoretical Framework ◽  
Subprime Crisis ◽  
Content Type ◽  
Uncertainty Shocks ◽  
The Us ◽  
Lehman Brothers ◽  
The Usa

Purpose – The purpose of this paper is to examine the effects of the 2007-2009 uncertainty shocks on policymakers’ behavior. Design/methodology/approach – Uncertainty shocks in the US credit, financial and production markets are represented by extraordinary events. As in Bloom (2009), these events are associated with significant economic and political shocks (e.g. Lehman Brothers’ collapse). Credit markets uncertainty shocks, which played a crucial role in the aftermath of the house prices collapse in the USA, are first analyzed in a bivariate VAR context, and then, embodied in a simple theoretical framework. Findings – The empirical evidence suggests that the US credit, financial and production markets have been affected by a relative large number of uncertainty shocks (i.e. rare events). In a Brainard’s (1967) uncertainty scenario, it is shown that a bizarre money-liquidity relationship exacerbates the “policymakers’ cautiousness-aggressiveness trade-off.” In addition, the model suggests that a “double” dose of policy, in presence of a global credit crunch, might be useless. Originality/value – This paper improves the existing literature in two main directions. First, it provides novel empirical evidence on the unusual dynamics of the US credit market and its effects on the real economic activity during the crisis. Second, in a very simple theoretical framework accounting for parameter uncertainty, it addresses whether a bizarre money-credit relationship affects policymakers’ behavior (i.e. cautiousness vs aggressiveness).

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