scholarly journals The Macroeconomic Effects of European Debt Crisis and Turkey

2015 ◽  
Author(s):  
Ahmet Ulusoy ◽  
Mehmet Ela
Keyword(s):  
Financial Crisis ◽  
Interest Rates ◽  
Sovereign Debt ◽  
Global Financial Crisis ◽  
Debt Crisis ◽  
Banking Regulation ◽  
Sovereign Debt Crisis ◽  
Private Debt ◽  
European Sovereign Debt Crisis ◽  
Low Interest Rates

European sovereign debt crisis is the period that because of low interest rates, government and private debt increased substantially and also financial crisis transform private debt to high sovereign debt. In this period, low interest rates made government borrowing cost cheap and so sovereign debt increased considerably. In same period, private sector consumption and debt rose and this induced the housing bubbles. The expansionary fiscal policy against the effects of global financial crisis and bail-outs given to banks which are problematic made the sovereign debt highest and debt burden unsustainable for some countries. European sovereign debt crisis affect the world globally with the financial and economic links. Countries implemented fiscal and monetary policies against the recession and unemployment. In this respect, it is worthwhile researching the European sovereign debt crisis which is multifaceted and complex and offering suggestions for Turkey. Turkey must maintain the strong fiscal position and increased country resilience against crisis. And Turkey must also maintain banking regulation and supervision which are intended to steady financial sector. The aim of this paper is analyzing the development of European sovereign debt crisis and its effects; and also emphasizing the actions Turkey can take and offering suggestions for Turkey.

On Financial Contagion Through ETFs

2020 ◽  
pp. 82-101
Author(s):  
Alexia Thomaidou ◽  
Dimitris Kenourgios
Keyword(s):  
Financial Crisis ◽  
Sovereign Debt ◽  
Global Financial Crisis ◽  
Debt Crisis ◽  
Financial Contagion ◽  
Sovereign Debt Crisis ◽  
European Sovereign Debt Crisis ◽  
The Interest Rate ◽  
The Global Financial Crisis ◽  
The Impact

This chapter investigates the impact of the Global Financial Crisis and the European Sovereign Debt Crisis in ETFs across regions and segments. In particular, two tests are taking place, with the first one to examine if there is evidence of contagion effect and the second one to test the affection of risks in each pair of ETFs. The evidence across the stable period and the two crisis periods suggests the existence of the transmission of shocks from the Global Financial ETF to regional and sectoral ETFs. However, there is evidence that some of the ETFs remain less unaffected during both crises and some of them are immune. Moreover, the authors examine the impact of several control variables, which represent various risks, to the correlation of each pair of ETFs and the results show the influence of the interest rate risk and interbank liquidity risk during the Global Financial Crisis and the European Sovereign Debt Crisis.

scholarly journals The Shift-Contagion Effect Of Global Financial Crisis And The European Sovereign Debt Crisis On OECD Countries

2013 ◽  
Vol 30 (1) ◽  
pp. 301 ◽  
Author(s):  
Irfan Akbar Kazi ◽  
Mohamed Mehanaoui ◽  
Farhan Akbar
Keyword(s):  
Financial Crisis ◽  
Sovereign Debt ◽  
Global Financial Crisis ◽  
Debt Crisis ◽  
Sovereign Debt Crisis ◽  
Policy Makers ◽  
Dynamic Correlations ◽  
European Sovereign Debt Crisis ◽  
Recent Financial Crisis ◽  
The Global Financial Crisis

<p>This article investigates shift-contagion as defined by Forbes and Rigobon (2002) in 16 OECD member economies during most recent financial crisis i.e. global financial crisis (2008-2009) and European sovereign debt crisis (2009-2012), using multivariate asymmetric dynamic conditional correlation model developed by Cappiello et al. (2006). The empirical analyses provide substantial evidence of shifts in the dynamic correlations and hence reconfirm shift-contagion during the global financial crisis that originated from U.S. However, there is no evidence in support of shift-contagion during the European sovereign debt crisis which originated from events in Greece. The results provide important implications for investors and policy makers.</p>

Conclusion

2018 ◽  
Author(s):  
Nauro F. Campos ◽  
Paul De Grauwe ◽  
Yuemei Ji
Keyword(s):  
Financial Crisis ◽  
Business Cycle ◽  
Sovereign Debt ◽  
Global Financial Crisis ◽  
Debt Crisis ◽  
Structural Reform ◽  
Structural Reforms ◽  
Sovereign Debt Crisis ◽  
The Business Cycle ◽  
The Global Financial Crisis

Structural reform policies move like the business cycle. There are moments when these are implemented with great fervour and others when they are put on the back burner or even dismantled. After the global financial crisis, and in particular the sovereign debt crisis in Europe, many countries were forced by creditor countries or were self-imposed to apply deep reforms to their product markets and especially to their labour markets. Now that Europe is recovering, the pressure to implement structural reforms has abated....

scholarly journals Rating Agencies, Self-Fulfilling Prophecy and Multiple Equilibria? An Empirical Model of the European Sovereign Debt Crisis 2009-2011

2017 ◽  
Vol 7 (1) ◽  
pp. 199 ◽  
Author(s):  
Manfred Gartner ◽  
Bjorn Griesbach
Keyword(s):  
Interest Rates ◽  
Sovereign Debt ◽  
Multiple Equilibria ◽  
Rating Scale ◽  
Debt Crisis ◽  
Sovereign Debt Crisis ◽  
Coefficient Estimates ◽  
Macroeconomic Variables ◽  
Rating Agencies ◽  
European Sovereign Debt Crisis

We explore whether governments may have faced scenarios of self-fulfilling prophecy and multiple equilibria during Europe’s sovereign debt crisis. To this end, we estimate the effect of interest rates and other macroeconomic variables on sovereign debt ratings, and of ratings on interest rates. We detect a nonlinear effect of ratings on interest rates which is strong enough to permit multiple equilibria. The good equilibrium is stable, ratings are excellent and interest rates are low. A second unstable equilibrium marks a threshold beyond which the country slides towards an insolvency trap. Coefficient estimates suggest that countries should stay well within the A segment of the rating scale in order to remain safe from being driven towards default.

7. The global financial crisis and the Eurozone sovereign debt crisis

2016 ◽  
pp. 101-118
Author(s):  
John Goddard ◽  
John O. S. Wilson
Keyword(s):  
Financial Crisis ◽  
Sovereign Debt ◽  
Global Financial Crisis ◽  
Debt Crisis ◽  
Investment Banks ◽  
Sovereign Debt Crisis ◽  
Mortgage Backed Securities ◽  
The Us ◽  
European Banks ◽  
The Global Financial Crisis

‘The global financial crisis and the Eurozone sovereign debt crisis’ describes the chain of events in the US financial crisis that then triggered the Eurozone banking collapse. It outlines the problems in US mortgage-backed securities, the collapse of three of the ‘big five’ investment banks (Bear Stearns, Lehman Brothers, and Merrill Lynch), and the actions of the US Federal Reserve and the Treasury. Several major European banks also foundered at the height of the financial crisis as a consequence of the US crisis and, by the end of 2014, five Eurozone member countries—Ireland, Greece, Spain, Portugal, and Cyprus—had received bailout loans from the EU and International Monetary Fund, conditional on the implementation of tough austerity measures.

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