BANK FAILURES IN THEORY AND HISTORY: THE GREAT DEPRESSION AND OTHER "CONTAGIOUS" EVENTS pptx

... experience of the U.S. Savings and Loan industry debacle of the 1980s, the banking collapses in Japan and Scandinavia during the 1990s, and similar banking system debacles occurring in 140 ... that risks had increased and as they also were aware of what NBER WORKING PAPER SERIES BANK FAILURES IN THEORY AND HISTORY: THE GREAT DEPRESSION AND OTHER "CONTAGIOUS" EVENTS Charles ... protect banks from market discipline, intended as a cure for instability, have instead become the single greatest source of banking instability. The theory behind the problem of destabilizing protection...

... 2008-09, they fell only in the U.K., Russia, Switzerland, Hong Kong and Singapore. The widespread falls in bank deposits in 1931 were only the beginning of the story and they were followed in most ... on one side and Austria and Germany on the other obstructed the functioning of the international monetary system. The data in table 3.2 suggest that the Netherlands and Switzerland, too, did ... 2008. In Russia, however, the main policy concern in the last few months of 2008 was to maintain the rouble’s exchange rate and interest rates were increased (they fell in 2009 however). And in...

... underscoring the importance of introducing fixed effects into the present count regressions. Then again, in the case that determinants interrelate with the number of bank failures meaning that the strict ... dramatically aggravatingdegree of fragility in the banking industry culminating in the savings and loans (S&L)crisis. After dropping the 1982 to 1992 period, with in excess of 100 bankruptcies ... and in particular large, banks wipes out liquidity and ignites an uncertainty-induced hysteria undermining the confidence in the proper working of the banking industryas such.5 ConclusionsIn...

... see him gathering in his crops and handing over the white farmer's share of the crop to the owner of the land; watch the farmer receiving his tribute from the native tenants, and see him ... Most of the Dutch journals, especially in the northern Provinces, take up the views of English-speaking Dutch townsmen (solicitors and Bank clerks), and publish them as the opinion of the South ... Nyokong's offer and accompanied me on a part of the journey. Besides the information received and the hospitality enjoyed from these and other friends, the author is indebted, for further information,...

... to the rescue bank upon assuming the businesses from the failed bank, thereby protecting depositors and other creditors of the failed bank. Although stock prices had been declining since the ... removed and the institutions were liquidated after transferring their business to the TKB. The participation of the private financial institutions in providing capital and low interest loans to the ... all the local banks, the majority of the smaller regional banks, and the fourth largest bank (NOR), were organised as savings banks, i.e. mutually held institutions. The others, including most...

... to the dopamine D2receptor and its genetic variants,D2R1, D2R2, which were localized in the plasma mem-brane and inside the cell. In the case of the dopa-mine D2receptor mutants, the ... codons and introduced a unique restriction site,XhoI, for both dopamine receptors and SacI for stimula-tory and inhibitory G protein subunit. The resulting frag-ments were inserted, in- frame, into ... respectively, were used as the mold for the PCR-Quik reaction. Incorporating the oligonucleotide primers,each complementary to the opposite strand of the vector and containing the desired mutations,...

... namedGodfrey, and hires him as family butler. Godfrey brings a much-needed sense of reality to the crazy, spoiled and rich family. This again reinforced the competency and the ascendancy of the working and ... between the wealthy and poorer classes. The films generally sided with theirlower class protagonists and often showed the wealthy classes to be inept and in need of the goodcommon sense of the ... structures were rocked by the depression, comedies released in these yearsbegan to express a disdain for traditional institutions and values. The Marx Brothers spoofedeverything from class structures,...

... few,ifany,institutionswithahighratingfailedwithinayearafter the ratingswerepublished.Althoughnotalllow‐ratedinstitutionssubsequentlyfailed, the failurerateoflow‐ratedinstitutionswasveryhigh,validatingourviewthattheyareatriskoffailure,especially in adeeprecessionor depression.  In 1987,WeissResearchpurchased the Holt bank ratingsdatabase and quantitativemodels,incorporatingelementsofitsownqualitative bank ratingsmethodology and publishingtheseunder the bannerofWeissSafetyRatings. In its1994study,InsuranceRatings:ComparisonofPrivateAgencyRatingsforLife/HealthInsurers,3 the U.S.GeneralAccountabilityOffice(GAO)reviewed the Weissratingsscale(fromAtoF) and determinedthataWeissSafetyRatingofD+orlowerdenotesinstitutionsthatare“vulnerable”tofuturefinancial failures. Further, the highpercentageofcompaniesratedD+orlowerthatsubsequentlyfailedagainvalidated the generalaccuracyofthatdesignation.Although the GAOwasreferringtoadifferentindustry(life and healthinsurers), the Weissratingsscalewasdesignedtoconvey the samesignificanceacrossvariousfinancialindustries,includingcommercialbanks,savingsbanks, and savings and loanassociations. In 2006, the NewYorkmediafirmTheStreet.compurchased the WeissRatings,nowcalledFinancialStrengthRatings.However,TheStreet.comratingsscale(AthroughF)is the sameas the earlierWeissratingsscale,while the ratingsmethodologyhasremainedvirtually the sameaswell.Now,for the purposesofthispaper,TheStreet.comhasprovidedalistofallrateddepositoryinstitutionswithaFinancialStrengthRatingofD+(weak)orlower.4 And basedon the backgroundcitedabove,webelieve the listisbothmorecomprehensive and moreaccuratethan the FDIC’s.5From the list,WeissResearchfindsthat: ... In sum,atotalof1,568banks and thriftsareatriskwithassetsof$2.32trillion.That’s6times the numberorinstitutions and 15times the assetsofbanks and thriftson the FDIC’sfourthquarter2008ProblemList. Given the deterioration in banks and in the economyreportedby the FDIC and the CommerceDepartment,itislikelythatmorebanks and thriftswillbeaddedto the listoncefourthquarterratingsbecomeavailable.3Available in pdfimageformatprovidedby the GAOathttp://archive.gao.gov/t2pbat2/152669.pdf.4TheStreet.com’sdatasourcesare the FederalFinancialInstitutionsExaminationCouncilCallReport and the OfficeofThriftSupervision’sThriftFinancialReportsfor the thirdquarterof2008,asprovidedbyHighlineFinancial,Inc.,withreferenceto the fourthquarterCallReportsstrictlytodeterminewhichbankswerestill in businessatyearend.5 The opinionsexpressedhereregardingTheStreet.comratingsareexclusivelythoseofMartinWeiss and WeissResearch.11 The precisedifferencesbetween the FDIC’smethodforflaggingproblembanks and the methodusedherearenotknown.However, the aggregateresultsshouldmakeitclearthat the magnitudeof the bankingtroubles in the U.S.todaycouldbefargreaterthanwhat the FDICispubliclyrecognizing.12PartIIU.S.CommercialBanksHaveTakenMassive,OftenUnquantifiable,Risks in TheirDerivativesHoldings The collapseofmajorfinancialinstitutionssince2008hascomeasashocktobothWallStreet and Washington.Butnearly15yearsago, the U.S.GovernmentAccountabilityOffice(GAO)explicitlywarnedofthispossibility.OnMay18,1994, in alandmarkstudy,FinancialDerivatives,ActionsNeededtoProtect the FinancialSystem,6itstatedthat:1. ... The federalgovernmentwouldnotnecessarilyintervenejusttokeepamajorOTCderivativesdealerfromfailing,buttoavertacrisis, the FederalReservemayberequiredtoserveaslenderoflastresorttoanymajorU.S.OTCderivativesdealer,whetherregulatedorunregulated.” In responseto the GAO’s1994warningsabove, the financialindustry’sresponsewasbothaudible and caustic.MajorWallStreetfirmspushedbackwithconcertedlobbyingeffortstoblockanyregulatorychangesat the pass,while“ChickenLittle”accusationswereleveledat the authors,Congressionalrequestersof the study, and anyindependentfirm,suchasWeissResearch,thatmadeforecastsbasedonitsconclusions.7 The industry’sprimaryargument in defenseofderivativeswasthattheyhelpedtoreduceriskthroughhedging, and thateachderivativespositionwasgenerallybalancedagainstoffsettingpositions.However,manylargefinancialinstitutions—suchasBearStearns,LehmanBrothers,MerrillLynch and the AmericanInsuranceGroup(AIG)—wentfarbeyondhedging,transformingtheirderivativesdivisionsintomajorprofitcentersbasedonspeculativetrading.Moreover,theydidnotadequatelyprotectthemselvesagainstdefaultsbytheirtradingpartnersoranticipate the severityof the systemriskstressedby the GAO.Subsequently,asdetailed in the GAO’sfollow‐upreport,FinancialDerivatives:ActionsTakenorProposedSinceMay1994,8some,mostlycosmetic,changesweremade.Buttheydidnothingtoslow the meteoricgrowthof the veryinstruments and practicesthat the GAOidentifiedasposing the greatestthreatstofinancialinstitutions and the financialsystem.Specifically, In its1994study, the GAOreported, The bestavailabledataindicatethat the totalvolumeofworldwidederivativesoutstandingasofyear‐end1992wasatleast$12.1trillion in termsof the notional,orprincipal,amountofderivativescontracts.”Although the GAOrecognizedthat the $12.1trillionoverstated the actualrisk,italsostatedthat“firmsthatusederivativescansustainsignificantlosses,”implyingthat$12.1trillionwasalreadyconsideredadangerouslylargenumber.However,thatnumberpales in comparisonto the latesttallyofnotionalOTCderivativesby the Bank ofInternationalSettlements(BIS).9Atmid‐year2008, the BISreported$683.7trillion,or56.5times the levelreportedby the GAOfor1992.Worse,amongthesewere$57.3trillion in creditdefaultswaps,orbetson the failureofnamedcorporations.Thesecontractsarewidelyrecognizedas the highestriskcategoryofderivatives and aredirectlyresponsibleforthedemiseofAIG,oneof the largestthreatsto the globalfinancialsystemtoday.7 In SafeMoneyReport,Issue#294,October2,1998,wewrote“Evenas the Dowmakesnewhighs,WallStreet and the world’sfinancialmarketssitatopagiganticmountainofderivatives—high‐riskbets and debtsthattotalamind‐boggling$285trillion.”http://www.martinweiss.com/images/PDF/SMR/SMR294.pdf.Similarly, in SafeMoneyReport,Issue#391,November2006,wewrote“It’saglobalVesuviusthatcoulderuptatalmostanytime,instantlythrowing the world’sfinancialmarketsintoturmoil...

... from the String- Database (the former string is referred to as the Similar-String, and the latter as the Error-String). Finally, the correction is made using the difference between these ... and the other is the corresponding correct string (the former string is referred to as the Error- Part, and the latter as the Correct-Part respectively). These parts are extracted from the ... 2: Take the string (Error-String) that comprises an error-block and each M (5 in the experiment) character before and after the error-block out of the input string, and using this string (Error-String)...

... The End—or the Beginning81“Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process ... the newly created Federal Reserve Banks. They could thus increase their own loans, and therefore the “money supply” they could bring into being. This made inflation possible; but this fact ... know.”3 The People are Demanding an End to InflationThe recent chaos in the money markets is telling us that the world is rejecting the American dol-lar as a reserve currency, and agreeing...