scholarly journals Economic Insecurity as Systemic Risk

2015 ◽  
Vol 62 (s1) ◽  
pp. 29-36
Author(s):  
Ion Pârţachi ◽  
Eugeniu Gârlă
Keyword(s):  
Systemic Risk ◽  
Economic Activity ◽  
Financial Stability ◽  
Banking Sector ◽  
Activity Index ◽  
Analytical Description ◽  
Economic Security ◽  
Economic Insecurity ◽  
Corporate Sector ◽  
New Approach

Abstract Difficulties related to the problem of evaluating the economic security / insecurity, including the threshold of economic security / insecurity, namely the impossibility of giving an analytical description of a criterion entirely made up of a set of indicators describing the degree of economic security / insecurity, makes more and more researchers, including the authors, to seek indirect ways of finding solutions, for example considering systemic risk., as a measure of evaluation. Thus, starting from a new approach, and given the specific components of systemic risk to financial stability: the banking sector, corporate sector, public sector, volume of credits, economic activity index the threshold vector of economic security / insecurity can be developed. The study shows that systemic risk can be used to measure the threshold of economic security /insecurity.

scholarly journals Less Bang for Your Buck? How Social Capital Constrains the Effectiveness of Social Welfare Spending

2018 ◽  
Vol 18 (3) ◽  
pp. 215-245 ◽  
Author(s):  
Mallory E. Compton
Keyword(s):  
Social Capital ◽  
Social Welfare ◽  
Financial Stability ◽  
Social Institutions ◽  
Economic Security ◽  
Economic Insecurity ◽  
Welfare Programs ◽  
Welfare Spending ◽  
Social Welfare Programs ◽  
Open Question

Rising economic insecurity in recent decades has focused attention on the importance of social welfare programs in managing household financial stability. Some governments are more effective than others in managing this outcome, and informal social institutions help explain why. Social capital is expected to shape economic security through multiple mechanisms, but whether the effect is to magnify or mitigate volatility is an open question. Part of the answer has to do with how social capital interacts with policy implementation, and whether it conditions the effectiveness of government spending. Evidence from the U.S. states from 1986 to 2010 fails to support a benevolent social capital thesis—not only is social capital associated with greater economic insecurity, there is no evidence that it improves social welfare effectiveness. However, greater spending on some social programs can mitigate the adverse impact of social capital on economic security.

Risk of full-blown Turkish currency crisis is rising

2020 ◽  
Keyword(s):  
Risk Premium ◽  
Economic Activity ◽  
Financial Stability ◽  
Corporate Debt ◽  
Infrastructure Projects ◽  
Sharp Decline ◽  
Corporate Sector ◽  
Content Type ◽  
Downward Pressure ◽  
Repo Rate

Significance Despite dramatic depreciation of the lira since early March, the TCMB is likely to continue cutting its benchmark one-week repo rate, now at 8.75%, as it tries to mitigate the sharp contraction in economic activity stemming from the COVID-19 pandemic. It is prioritising disinflationary pressures over threats to financial stability. This will push real rates deeper into negative territory, maintain downward pressure on the lira and fuel concerns about the external indebtedness of Turkey’s corporate sector. Impacts A likely requirement for cherished infrastructure projects to be axed is one factor behind Erdogan’s resistance to an IMF deal. The risk premium on Turkish dollar-denominated corporate debt is rising -- spreads have risen by 400 basis points in three months. Cheap oil is contributing to a sharp decline in Turkish inflation: the headline rate is likely to drop into single digits by July.

scholarly journals РЕГУЛЮВАННЯ ДІЯЛЬНОСТІ БАНКІВСЬКОГО СЕКТОРА У КОНТЕКСТІ ЗАБЕЗПЕЧЕННЯ ЙОГО ЕКОНОМІЧНОЇ БЕЗПЕКИ

2020 ◽  
pp. 91-98
Author(s):  
Плукар Л.А.
Keyword(s):  
Financial Stability ◽  
Banking Sector ◽  
Banking System ◽  
Banking Regulation ◽  
Economic Security ◽  
State Regulation ◽  
Crisis Prevention ◽  
Regulation And Supervision ◽  
Systemic Risks ◽  
National Banking System

The article substantiates the need to regulate the banking sector to ensure economic security of its operation. The main tasks of state regulation and supervision of the banking sector have been identified. The types of existing models of the institutional structure of the system of banking regulation and distribution of powers between prudential supervisors are revealed. Requirements for the development of a model of regulatory policy in the banking sector of Ukraine have been formed. The necessity of creating early crisis prevention systems (macroeconomic, based on warning indicators), monitoring of systemic financial institutions, application of macroprudential analysis with regular publication of a strategic document - the Financial Stability Report. The foreign experience of macroprudential regulation and supervision with the help of established specialized divisions of central banks on financial stability and security is reflected. The creation of a separate unit of financial stability and security in Ukraine was initiated, reporting directly to the Chairman of the NBU. The scheme of correlation of subjects of management and tools of maintenance of economic safety of national banking system with separation of subjects of management of economic safety of banking sector, tools of maintenance of economic safety of banking sector at the international and national levels of banking supervision is developed. The implementation of the principles of the Basel Accords in the activity of the banking system of Ukraine is determined as a determining factor in strengthening its financial stability and economic security. The issue of trust in the banking system is one of the main criteria for success, efficiency and security of the banking sector of the economy of each state. The need for monitoring and management of systemic risks has been proved.

Lehren aus der Krise – Notwendige Änderungen der Finanzmarktregeln und zur Begrenzung systemischer Risiken

2009 ◽  
Vol 58 (3) ◽  
Author(s):  
Otmar Issing ◽  
Stephany Griffith-Jones ◽  
Stefano Pagliari ◽  
Claudia M. Buch ◽  
Katja Neugebauer
Keyword(s):  
Financial Crisis ◽  
Systemic Risk ◽  
Financial Stability ◽  
Market Failure ◽  
Banking Sector ◽  
Global Financial Crisis ◽  
Systemic Risks ◽  
State And Market ◽  
Bank For International Settlements ◽  
The International Monetary Fund

AbstractThe latest financial crisis has been caused by a mixture of state and market failure, argues Otmar Issing. To avoid future crises, more transparency is needed - not by gathering more information, but by gathering it systematically and thereby creating “intelligent transparency”. Furthermore, regulation has to be global, he states. The necessary institutions are in place: The International Monetary Fund, the Financial Stability Board and the Bank for International Settlements.Stephany Griffith-Jones and Stefano Pagliari point out, that containing “systemic risk” is one of the most important rationales for regulating financial markets. Our understanding of the sources of systemic risk has repeatedly been challenged by major episodes of financial instability. The crisis that started in the summer of 2007 has been no exception. They discuss how the latest global financial crisis urges analysts and regulators to rethink the origin of systemic risk beyond a narrow focus on the banking sector, beyond the “too big to fail problem”, and beyond a narrow micro-prudential focus. They focus on two regulatory principles: comprehensiveness and countercyclicality.Claudia Buch und Katja Neugebauer review the existing empirical evidence on whether the increase in cross-border activities has allowed banks to diversify risks and to what extent it has increased banks’ exposure to systemic risks.

Economic Security of Enterprise and the System of its Ensuring

2015 ◽  
Author(s):  
Alina Ianioglo ◽  
Tatjana Polajeva ◽  
Dmitri Parmacli
Keyword(s):  
Sustainable Development ◽  
Economic Activity ◽  
Financial Stability ◽  
Scientific Literature ◽  
Economic Security ◽  
Negative Consequences ◽  
Internal Factors ◽  
National Science ◽  
System Functioning ◽  
The Relationship

In modern conditions of unpredictability of economic activity, enterprises represent an open dynamic system. Functioning and development of the enterprises is influenced by numerous external and internal factors. Multiple threats of economic security may lead to negative consequences in form of solvency and financial stability violations, profitability reduction and other deterioration in the enterprise. In this regard, the relevance and the need of ensuring economic security of enterprises are increasing. The issues of economic security are relatively new to the national science. At the same time, a sufficient number of scientific literature devote to this topic. In this article is presented the analysis and the systematization of various definitions of economic security. On its basis, the authors have identified five main approaches. The relationship between economic security and other economic categories such as sustainability, effectiveness, development and independence was explained. In order to counter threats of economic security and to ensure stable functioning of enterprise, the system of economic security is developed and presented in the paper. Under this system, main ways of increasing the level of economic security of enterprises was presented. Ensuring of economic security of each enterprise serve as a basis for sustainable development both businesses and the economy as a whole.

scholarly journals The ECB, Between Conservatism and Pragmatism

2016 ◽  
Vol 5 (1) ◽  
pp. 25-52 ◽  
Author(s):  
Cécile Bastidon ◽  
Philippe Gilles ◽  
Nicolas Huchet
Keyword(s):  
Monetary Policy ◽  
Economic Activity ◽  
Financial Crises ◽  
Financial Stability ◽  
Banking Sector ◽  
Private Funding ◽  
European Central ◽  
Forward Guidance ◽  
Policy Transmission ◽  
Theoretical Construction

Abstract The 2008 and 2011 crises have durably affected the conditions of monetary policy transmission, particularly in the euro area. However, it is generally considered that the European Central Bank’s (ECB) monetary policy truly became unconventional only at a late stage. Our contribution is threefold. We first show that the notion of “conventional” monetary policy, which is the reference of this assessment, is a recent theoretical construction. Secondly, the mandate of the ECB, which is its institutional expression, may raise specific difficulties in managing major financial crises, particularly with regards to the forward guidance of expectations and the commitment to an accommodative policy. Finally, the resulting policies have, at this stage, paradoxically achieved acceptable levels of macroeconomic and overall financial stability, but failed to restore a private funding supply to the banking sector enabling it to play its normal role in financing economic activity.

scholarly journals Macroprudential Regulation in Ensuring of the Development of Financial Markets

2020 ◽  
Vol 22 (1) ◽  
pp. 24-30
Author(s):  
Victoria Kovalenko ◽  
◽  
Sergii Sheludko ◽  
Keyword(s):  
Financial Markets ◽  
Systemic Risk ◽  
Financial Stability ◽  
Banking Sector ◽  
Asset Markets ◽  
Price Stability ◽  
Shadow Banking ◽  
Credit System ◽  
Macroprudential Regulation ◽  
Goods And Services

Introduction. The study has confirmed that ensuring of financial markets’ development stability is connected with the development of an effective system for macroprudential regulation. The financial crisis has shown that price stability is not enough to ensure financial stability. The financial and business cycles are not synchronized – therefore risks can arise, especially during periods of “disconnection” between two cycles. Purpose. The aim of the paper is to systematize basic concepts of macroprudential regulation in financial markets, considering international practice of its instruments selection and usage. Results. It is clarified the approaches to a set of macroprudential instruments formation which depends on the country’s economic development and the vulnerability of a financial sector to internal and external shocks. It has been substantiated that monetary regulation is aimed at ensuring price stability in the market for goods and services. It has been proven that it should not be used to address hotbeds of volatility in asset markets. This is a subject for macroprudential regulation, aimed to ensuring the stability of financial markets and containing systemic risk. It has been identified the factors causing the need to implement the strategy of macroprudential regulation in financial markets to ensure their stable development. They include: systemic risk and financial cycles; considering the importance of a growing market’s credit system and measures to address its risks; the need to increase the transparency of the shadow banking sector; problems in regulating the FinTech branch; international financial standards; the growing role of the central periphery in international finance. Conclusions. It has been concluded that a powerful macroprudential political mandate and an adequate set of instruments should be given for central banks to solve the problem of increasing financial risks, especially in situations where monetary regulation is adaptive. It has been substantiated the conclusion about the need to develop supervisory and coordination mechanisms in the financial market and the introduction of end-to-end monitoring of systemic risks as a prerequisite for restoring financial stability.

scholarly journals DEVELOPMENT OF A MECHANISM FOR MANAGING THE INCOME OF FINANCIAL AND CREDIT INSTITUTIONS IN THE CONTEXT OF ECONOMIC MODERNIZATION

2021 ◽  
Vol 80 (1) ◽  
pp. 53-58
Author(s):  
G. P. Koptayeva ◽  
◽  
M. Kanabekova ◽  
Ye. Zh. Yertayev ◽  
A. B. Orazbayeva ◽  
...  
Keyword(s):  
Financial Management ◽  
Financial Stability ◽  
Banking Sector ◽  
High Efficiency ◽  
Banking System ◽  
Economic Security ◽  
Practical Implementation ◽  
The Stability ◽  
Definition Of ◽  
Credit Institutions

The research is caused, firstly, by the need to specify the definition of financial and credit institutions as subjects of the banking sector of Kazakhstan, analyze and evaluate existing approaches to managing their stability in the strategic aspect and identify factors (possible threats and dangers) that lead to loss of financial stability, and, secondly, by the need to develop a mechanism for managing the financial profitability of financial and credit institutions, ensuring their stable position both in the short and long term. To improve the quality of financial management and ensure the profitability of financial and credit institutions, it is necessary to justify and develop a strategy for managing their financial stability. At the same time, it should be borne in mind that even with high efficiency and profitability, insufficient attention to the issues of ensuring the stability and economic security of financial and credit institutions can lead to financial difficulties for them. Taking into account the problems discussed above, the relevance of issues related to improving the stability mechanism of financial and credit institutions has significantly increased, as has the need to find a new methodological apparatus aimed at adapting and studying foreign experience and its practical implementation in the domestic banking system.

ACTUAL PROBLEMS OF ENSURING ECONOMIC SECURITY IN THE DIGITAL ECONOMY

2020 ◽  
pp. 152-163
Author(s):  
Evgeniy A. Voronin ◽  
◽  
Igor V. Yushin ◽  
Keyword(s):  
Economic Activity ◽  
Final Stage ◽  
Economic Effect ◽  
Economic Security ◽  
Digital Economy ◽  
Real Sector ◽  
Economic Activities ◽  
New Approach ◽  
User Training ◽  
Main Indicator

This article discusses the current problems of ensuring economic security in the context of the development of the digital economy. It is noted that the digital economy is a new tool for stimulating economic activity. At the same time, there are a number of problems that limit the use of the potential of the digital economy in practice. It is concluded that these problems were formed in the real sector of the economy, while in the digital sphere they cannot be eliminated. It is necessary to develop a fundamentally new approach to ensuring the economic security of economic activities. Considering the problems of implementing the digital economy, economic security specialists faced the problem of having an economic effect only at the final stage of digitalization projects. At the same time, a significant part of the costs associated with user training, the introduction of funds into the life processes of individuals and society, and the elimination of the consequences of the unsuccessful implementation of such systems are frankly not taken into account. The main indicator remains the economic effect calculated on the basis of a limited number of indicators.

scholarly journals DIAGNOSTICS OF THE ENTERPRISE’S FINANCIAL CONDITION DURING THE CRISIS

2021 ◽  
Author(s):  
Daria Yasynska ◽  
◽  
Olena Dobrovolska ◽  
Keyword(s):  
Economic Activity ◽  
Financial Stability ◽  
Economic Security ◽  
Working Capital ◽  
Systematic Calculation ◽  
Financial Condition ◽  
Normal Limits ◽  
Accounts Payable ◽  
Crisis Conditions

The paper reveals the essence of diagnostics of the financial condition of an agricultural enterprise during crisis and stipulates the necessity for its systematic implementation. As there are a lot of companies in Ukraine facing the crisis and as a consequence go bankrupt, which in turn negatively affects the dynamics of repayment of accounts payable, it is extremely important to study the financial condition of the company, dynamics of its payables and receivables in order to find the best ways to overcome the crisis and the normalize its economic activity. The article offers economic proposals for stabilizing the economic activity of the enterprise during the crisis. The article also proposes the systematic calculation of the enterprise’s liquidity and keep to these indicators within the normal limits. In its turn, there are several levels of financial security of the enterprise: absolute (the enterprise has sufficient working capital for operation); normal (the enterprise has enough funds to buy inventory and cover costs); satisfactory (the enterprise does not have enough working capital and it resorts to medium-term or long-term liabilities); critical (the company uses long-term loans to finance its activity) and crisis (the company is unable to meet its obligations). The financial condition and financial and economic activity of the enterprise is assessed by its solvency. Solvency acts as an external sign of financial stability, the essence of which is the security of current assets by long-term sources of formation. The success of the enterprise depends on the analysis of risks of threats to the management of financial and economic security of the business entity and leveling and consolidation of efforts in times of crisis. Thus, by analyzing the financial and economic activity of the enterprise, you can determine the dynamics of changes in economic performance. Control of financial and economic security of the enterprise will allow to carry out economic activity at a normal level and in case of deterioration to predict and prevent the onset of crisis conditions that can lead to bankruptcy.

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