Money growth variability and output: evidence with credit card-augmented Divisia monetary aggregates

2020 ◽  
Vol 24 (5) ◽  
Author(s):  
Jinan Liu ◽  
Apostolos Serletis
Keyword(s):  
Financial Stability ◽  
Credit Card ◽  
Negative Impact ◽  
Balance Sheet ◽  
Credit Cards ◽  
Money Growth ◽  
Monetary Policies ◽  
Growth Variability ◽  
Significant Negative Impact ◽  
Growth Volatility

Abstract We reexamine the effects of the variability of money growth on output, raised by Mascaro and Meltzer (1983), in the era of the increasing use of alternative payments, such as credit cards. Using a bivariate VARMA, GARCH-in-Mean, asymmetric BEKK model, we find that the volatility of the credit card-augmented Divisia M4 monetary aggregate has a statistically significant negative impact on output from 2006:7 to 2019:3. However, there is no effect of the traditional Divisia M4 growth volatility on real economic activity. We conclude that the balance sheet targeting monetary policies after the financial crisis in 2007–2009 should pay more attention on the broad credit card-augmented Divisia M4 aggregate to address economic and financial stability.

On the Major Differences between the Banking Systems of the EAEU States

2020 ◽  
Vol 26 (4) ◽  
pp. 397-406
Author(s):  
T. E. Chekanova
Keyword(s):  
Financial Stability ◽  
Systems Approach ◽  
Negative Impact ◽  
Banking Regulation ◽  
Member States ◽  
Banking Systems ◽  
Significant Negative Impact ◽  
The Difference ◽  
The Government ◽  
Major Factors

The presented study examines the problems of integration of the national banking systems of the member states of the Eurasian Economic Union (EAEU).Aim. The study aims to examine the major differences in various aspects of functioning of banking systems in the EAEU member states in terms of their impact on integration processes.Tasks. The author identifies the most prominent features of the banking systems of the EAEU states; reveals the depth of the existing differences through a comparative analysis of various indicators of national banking systems; outlines ways of overcoming integration problems associated with differences in the banking sectors of the Union states.Methods. This study is based on universal general scientific methods and elements of comparative, functional, and economic analysis within the framework of a systems approach. The author uses regulatory documents and banking reports of the EAEU states, statistical and analytical materials of the Eurasian Economic Commission (EEC), and data of Moody’s international rating agency.Results. The study identifies a number of aspects that contain the major differences in the functioning of banking systems in the EAEU member states; highlights the disproportions in the scale, level of development, financial stability, and risks of the banking spheres of the Union states; comparatively analyzes the proportion of banking and non-banking structures in the system and the share of the government and non-resident companies in the capital of banks; marks the difference in the pricing of banking services; determines differences in the existing approaches to banking regulation and the established standards; analyzes the major differences in the legislative acts of the central banks and governments of the EAEU member states and in the terms and definitions used. According to the results of the study, the major factors hindering the development of integration processes between the banking systems of the EAEU states are identified.Conclusions. The existing differences between the banking systems of the EAEU countries are diverse and multifaceted. The author states that the aspects addressed in this study have a significant negative impact on the further development of integration processes, describing the major directions and actions of the member states aimed at minimizing the exiting differences, which are required to facilitate the convergence of the states and the transition towards a common financial market.

scholarly journals The COVID-19 Shock and Consumer Credit: Evidence from Credit Card Data

2021 ◽  
Vol 2021 (008) ◽  
pp. 1-55
Author(s):  
Akos Horvath ◽  
◽  
Benjamin Kay ◽  
Carlo Wix ◽  
◽  
...  
Keyword(s):  
Interest Rates ◽  
Credit Card ◽  
Negative Impact ◽  
Consumer Credit ◽  
Credit Cards ◽  
Sharp Decrease ◽  
Main Driver ◽  
Credit Card Data ◽  
Pandemic Severity ◽  
The Impact

We use credit card data from the Federal Reserve Board's FR Y-14M reports to study the impact of the COVID-19 shock on the use and availability of consumer credit across borrower types from March through August 2020. We document an initial sharp decrease in credit card transactions and outstanding balances in March and April. While spending starts to recover by May, especially for risky borrowers, balances remain depressed overall. We find a strong negative impact of local pandemic severity on credit use, which becomes smaller over time, consistent with pandemic fatigue. Restrictive public health interventions also negatively affect credit use, but the pandemic itself is the main driver. We further document a large reduction in credit card originations, especially to risky borrowers. Consistent with a tightening of credit supply and a flight-to-safety response of banks, we find an increase in interest rates of newly issued credit cards to less creditworthy borrowers.

THE CASE FOR DIVISIA MONEY TARGETING

2012 ◽  
Vol 17 (8) ◽  
pp. 1638-1658 ◽  
Author(s):  
Apostolos Serletis ◽  
Sajjadur Rahman
Keyword(s):  
Economic Activity ◽  
The United States ◽  
Money Growth ◽  
Monetary Policies ◽  
Average Growth ◽  
Monetary Aggregates ◽  
Method Of Calculation ◽  
Divisia Monetary Aggregates ◽  
Level Of Aggregation ◽  
Growth Volatility

In this paper we investigate the relationship between money growth uncertainty and the level of economic activity in the United States. We pay explicit attention to the Divisia monetary aggregates. In doing so, we use the new vintage of the data [called MSI (monetary services indices) by the St. Louis Fed], together with the simple sum monetary aggregates, over the period from 1967:1 to 2011:3. In the context of a bivariate VARMA, GARCH-in-mean, asymmetric BEKK model, we show that increased Divisia money growth volatility (irrespective of the level of aggregation and the method of calculation) is associated with a lower average growth rate of real economic activity. However, there are no effects of simple-sum money growth volatility on real economic activity, except with the Sum M1 and perhaps Sum M2M aggregates. We conclude that monetary policies that focus on the Divisia monetary aggregates and target their growth rates will contribute to higher overall economic growth.

scholarly journals Factors affecting to select Islamic credit cards in Pakistan: the TRA model

2017 ◽  
Vol 8 (3) ◽  
pp. 330-344 ◽  
Author(s):  
Muhammad Ali ◽  
Syed Ali Raza ◽  
Chin-Hong Puah
Keyword(s):  
Regression Analysis ◽  
Credit Card ◽  
Negative Impact ◽  
Empirical Work ◽  
Credit Cards ◽  
Empirical Support ◽  
Influential Factor ◽  
Content Type ◽  
Factors Affecting ◽  
Bank Managers

Purpose This paper aims to investigate the factors affecting intentions to select Islamic credit cards in Pakistan by using the theory of reasoned action (TRA) model. In general, bank customers are aware of credit card facility, but the leading factors to select Islamic credit cards are particularly unexplored. Due to this fact, the study examined the effect of subjective norm (SN) and attitude (ATT) with the inclusion of new construct, namely, perceived financial cost (PFC) to predict the intention of customers about the Islamic credit card in Pakistan. Design/methodology/approach Sample data were conveniently drawn from the bank customers with the help of a self-administered survey based questionnaire, which was consisted over five-point Likert scale. The study uses a sample of 492 bank customers located in the biggest city of Pakistan. Out of these responses, only 466 responses were used in the analysis, while the remaining responses were ignored due to missing data and incomplete responses. The data were analyzed through factor and regression analysis. Findings Findings from regression analysis suggest that SN and ATT show positive and significant impact on intentions to select an Islamic credit card, while PFC has a negative impact on intentions to select Islamic credit cards. Moreover, SN was found to be the most influential factor to predict the selection of Islamic credit card. Research implications This study has some practical implications for the academicians and Islamic bank managers. Through this research, bank managers can educate their customers about Islamic credit and financial products. Not only this, they should develop a strategy for the awareness of Islamic banking products through social networking and other marketing modes. On the other side, this study laid a foundation for future researchers to explore additional predictors of Islamic credit card. Their empirical work will provide a help to benefit and understand customers’ financial knowledge. Originality/value Islamic credit facility is entirely new in Pakistan and lacking with empirical support. Therefore, this investigation contributes to the existing body of knowledge by providing a comprehensive explanation on the Islamic credit card service in Pakistan.

scholarly journals The Concept of Assessing the Level of the Enterprise Economic Security

2021 ◽  
Vol 11 (2) ◽  
pp. 1259-1268
Author(s):  
Irina Yurievna Vaslavskaya
Keyword(s):  
Financial Stability ◽  
Negative Impact ◽  
Cost Benefit Analysis ◽  
Balance Sheet ◽  
Cost Benefit ◽  
Economic Security ◽  
Assessment System ◽  
Risk Indicators ◽  
Decision Makin ◽  
Balance Sheet Liquidity

Several problems can be identified in assessing the economic security of organizations. Most of the developed techniques in this area involve the assessment of the financial component of economic security using methods for assessing the probability of the bankruptcy of the enterprise. At the same time, there are no unambiguously recommended evaluation methods; often enterprises are limited to any one complex methodology. Any evaluation of the financial component of the security is reduced to the cost-benefit analysis and evaluation of balance sheet liquidity and the financial stability of the organization, without the formation of an integral indicator. This approach does not consider the nature of internal processes and assesses the final impact of these “processes” on the indicators of financial statements (based on which the assessment of the financial component of economic security is formed). Also, one of the problems of assessing economic security using mathematical models is the complexity of mastering these models and the lack of the programs for performing calculations. It should be noted that it is a characteristic of the largest number of studied methods that usually assess the current state of the enterprise, the complex methodology does not consider threats, the maximum that can be considered is a possible prevented damage. Nevertheless, working with threats in the assessment system allows us to predict the possible negative impact on the state of economic security. And timely prevent these situations or “take the risk”, since it is advisable to assess threats through risk indicators. Assessment of economic security is as important as any other economic analytical information needed for the timely decision-makin and the formation of proactive measures.

scholarly journals Understanding Drivers of Employment Changes in a Multiple Sclerosis Population

2015 ◽  
Vol 17 (5) ◽  
pp. 245-252 ◽  
Author(s):  
Karin S. Coyne ◽  
Audra N. Boscoe ◽  
Brooke M. Currie ◽  
Amanda S. Landrian ◽  
Todd L. Wandstrat
Keyword(s):  
Multiple Sclerosis ◽  
Financial Stability ◽  
Employment Status ◽  
Negative Impact ◽  
Memory Loss ◽  
Physical Symptoms ◽  
Common Symptom ◽  
Decision To Leave ◽  
Multiple Sclerosis Population ◽  
Significant Negative Impact

Background: Qualitative data are lacking on decision making and factors surrounding changes in employment for patients with multiple sclerosis (MS). This study aimed to increase our understanding of the key symptoms and factors leading patients with MS to leave work or reduce employment. Methods: Adults with MS who reported leaving the workforce, reducing work hours, or changing jobs due to MS in the past 6 months were recruited from four US clinical sites. Patients participated in semistructured interviews to discuss MS symptoms and reasons for changing employment status. All interviews were transcribed and coded for descriptive analyses. Results: Twenty-seven adults (mean age = 46.3 years, mean duration of MS diagnosis = 10.9 years) with a range of occupations participated; most were white (81.5%) and female (70.4%). Physical symptoms (eg, fatigue, visual deficits) (77.8%) were the most common reasons for employment change; 40.7% of patients reported at least one cognitive symptom (eg, memory loss). Fatigue emerged as the most pervasive symptom and affected physical and mental aspects of patients' jobs. Most patients (85.2%) reported at least two symptoms as drivers for change. Some patients reported a significant negative impact of loss of employment on their mental status, family life, and financial stability. Conclusions: Fatigue was the most common symptom associated with the decision to leave work or reduce employment and can lead to a worsening of other MS symptoms. Comprehensive symptom management, especially fatigue management, may help patients preserve their employment status.

Analyzing the financial sustainability of the world's leading public oil and gas corporations

2020 ◽  
Vol 26 (6) ◽  
pp. 1246-1263
Author(s):  
O.V. Shimko
Keyword(s):  
Financial Stability ◽  
Oil And Gas ◽  
Global Financial Crisis ◽  
Negative Impact ◽  
Annual Reports ◽  
Significant Negative Impact ◽  
Financial Soundness ◽  
Economic Analyses ◽  
The Global Financial Crisis ◽  
Oil And Gas Companies

Subject. This article explores the key financial stability indicators of the twenty five largest public oil and gas companies between 2006 and 2018. Objectives. The article aims to determine the current values of the key financial stability indicators of the largest public oil and gas companies, identify key trends in their changes within the study period, and identify the factors that have caused these changes. Methods. For the study, I used comparative, and financial and economic analyses, and generalization. Results. Based on a comprehensive analysis of the twenty five oil and gas companies' annual reports, the article identifies trends in the changes in the key financial stability indicators in the industry's public sector, and establishes the main factors that affected these changes. Conclusions and Relevance. The article concludes that during the study period, the key financial stability indicators of the leading public oil and gas companies have deteriorated. However, the global financial crisis as a whole has not had a significant negative impact on the financial soundness of the public oil and gas sector. The results of the study can be used to evaluate, forecast, and develop measures to increase the financial stability of public oil and gas companies.

scholarly journals ANALYSIS OF THE FINANCIAL STATUS OF THE BANKING SECTOR OF UKRAINE

2020 ◽  
pp. 155-162
Author(s):  
D. Tsyhaniuk ◽  
A. Rudniak
Keyword(s):  
Financial Stability ◽  
Banking Sector ◽  
Global Financial Crisis ◽  
Negative Impact ◽  
Banking System ◽  
Financial Condition ◽  
Systemic Risks ◽  
Significant Negative Impact ◽  
The Global Financial Crisis ◽  
The Impact

Considering the significant negative impact of financial crises on the banking sector in Ukraine, issues related to the assessment of the financial condition of banks are becoming particularly relevant. Analysis of the impact of the global financial crisis on the activities of Ukrainian banks in recent years has led to the conclusion that an effective, working mechanism for anti-crisis management has not yet been developed, focused on forecasting, overcoming, and limiting the spread of the crisis in the banking system. In this study, we analyzed the state of the banking system of Ukraine, the factors of crises that affected the financial condition of the banking sector of Ukraine in the context of 2009-2019; studied the main performance indicators of banks currently operating in Ukraine; analyzed the financial results of banking activities; Identified systemic risks that operate in the banking sector, as well as the largest risk factors for the financial sector. Calculated indicators of financial stability indicated the existence of systemic risks. According to the results of our study, the dynamics of the ratio of non-performing loans pointed out that the banking system of Ukraine, along with the unstable political and general economic situation, further increases systemic risks for the banking system and for the economy in the entirety; analysis of the Z-score indicator confirmed the presence of systemic risks and clearly demonstrated the duration and level of the crisis; an analysis of the dynamics and the political component of the country's incapacity index indicated that now Ukraine is in the most volatile situation in the last decade.

scholarly journals Central Bank Balance Sheet Policies and Spillovers to Emerging Markets

2017 ◽  
Vol 17 (172) ◽  
Author(s):  
Manmohan Singh ◽  
Haobin Wang
Keyword(s):  
Monetary Policy ◽  
Interest Rates ◽  
Financial Stability ◽  
Emerging Market ◽  
Balance Sheet ◽  
Two Dimensions ◽  
Short Term ◽  
Monetary Policies ◽  
Policy Tool ◽  
Advanced Economies

We develop a theoretical model that shows that in the near future, the monetary policies of some key central banks in advanced economies (AEs) will have two dimensions—changes in short-term policy rates and balance sheet adjustments. This will affect emerging market economies (EMs), especially those with a pegged exchange rate, as these EMs primarily use a single monetary policy tool, i.e., the short-term policy rate. We show that changes in policy rates and balance sheet adjustments in AEs may differ in their respective financial spillovers to pegged EMs. Thus, it will be difficult for EMs to mitigate different types of spillovers with a single monetary policy tool. In that context, we use the model to show how EMs might use additional tools—capital controls and/or macro-prudential policy—to complement their monetary policy and financial stability toolkit. We also discuss how balance sheet adjustments that affect long-term interest rates may percolate to influence short-term interest rates via financial plumbing.

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